Which of the following statements regarding the unrelated business income tax is not correct?
A)Unrelated business income is income from activities not related to the exempt purpose of the organization.
B)The unrelated business income tax is levied because the exempt organization is engaging in substantial commercial activities.
C)If the unrelated business income tax were not levied, nonexempt organizations would be placed at a substantial disadvantage when trying to compete with the exempt organization.
D)The tax rate that is applied to unrelated business taxable income is the highest corporate tax rate.
E)All of the above statements are correct.

Question

Quizplus · Accepted Answer

The tax rate that is applied to unrelated business taxable income is the highest corporate tax rate. This statement is incorrect. The tax rate that is applied to unrelated business taxable income is the same as the tax rate that is applied to the income of nonexempt organizations.

Which of the Following Statements Regarding the Unrelated Business Income