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Hotel,Inc ,Is a Feeder Organization for Museum,Inc

Question 55

Multiple Choice

Hotel,Inc. ,is a feeder organization for Museum,Inc. ,an exempt organization.Hotel,Inc. ,provides approximately 25% of the support needed by Museum,Inc. ,to carry out its tax-exempt mission.Which of the following statements is correct?


A) Only Museum,Inc. ,is subject to Federal income taxation.
B) Both Museum,Inc. ,and Hotel,Inc. ,are subject to Federal income taxation.
C) Hotel,Inc. ,is subject to Federal income taxation on all of its income and Museum,Inc. ,is subject to Federal income taxation on 25% of its income.
D) Only Hotel,Inc. ,is subject to Federal income taxation.
E) None of the statements is correct.

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