Which of the following statements is correct?
A)For an exempt organization not to be classified as a private foundation under the broadly supported provision, both the external support test and the internal support test must be satisfied.
B)For an exempt organization not to be classified as a private foundation under the broadly supported provision, both the external support test and the internal support test must be failed.
C)For an exempt organization not to be classified as a private foundation under the broadly supported provision, the external support test must be satisfied and the internal support test must be failed.
D)For an exempt organization not to be classified as a private foundation under the broadly supported provision, the external support test must be failed and the internal support test must be passed.
E)None of the above statements is correct.

Question

Quizplus · Accepted Answer

The correct statement is that for an exempt organization not to be classified as a private foundation under the broadly supported provision, both the external support test and the internal support tests must be satisfied. This means that the organization must receive a substantial amount of its financial support from a broad range of sources (external support test) and must also receive a substantial amount of support from the general public or from other publicly-supported organizations (internal support test). Failing either of these tests would result in the organization being classified as a private foundation.

Which of the Following Statements Is Correct