To maintain exempt status, an organization must do which of the following:
A)Satisfy only an organizational test.
B)Satisfy only an operational test.
C)Satisfy both an organizational test and an operational test.
D)Satisfy a financial test.
E)Once exempt status is granted, it will continue regardless of whether the organizational test and the operational test are satisfied.

Question

Quizplus · Accepted Answer

To maintain exempt status, an organization must satisfy both an organizational test and an operational test. The organizational test looks at the organization's structure and whether it meets the requirements for tax-exempt status, while the operational test examines the organization's activities to make sure they align with its tax-exempt purposes. A financial test may also be required for certain types of organizations, but it is not the only requirement for maintaining exempt status. Once exempt status is granted, it is not guaranteed to continue indefinitely, and organizations must continue to meet these tests or risk losing their exempt status.

To Maintain Exempt Status, an Organization Must Do Which of the Following