A trade or business that is operated by an exempt organization which otherwise would be subject to the tax on unrelated business income is exempt from tax, if the profits generated by the trade or business are used by the exempt organization for exempt purposes.

Question

Quizplus · Accepted Answer

The use of profits for exempt purposes does not exempt a trade or business from unrelated business income tax (UBIT); it is the nature of the activity that determines taxability.

A Trade or Business That Is Operated by an Exempt