Reference no: EM132264735
1. A charitable organization may exclude rental real property income from unrelated business income UNLESS:
The income is reasonably related to an exempt purpose.
The rental real property is part of a mixed lease for real and personal property. Five percent of the rents are for the use of personal property.
The rent is received regularly over a sustained period of time.
The rent covers services provided by the organization as well as use of the property.
2. Which of the following organizations MAY use Form 1023-EZ to apply for an exemption?
A private foundation with gross receipts that do not exceed $50,000 and are not expected to exceed $50,000.
A synagogue with gross receipts that do not exceed $50,000 and are not expected to exceed $50,000.
A hospital with gross receipts that do not exceed $50,000 and are not expected to exceed $50,000.
A recreational soccer league.
3. Which of the following terms applies to a tax-exempt organization that is supported primarily by donations from a small set of individuals and exists to make grants to other tax-exempt organizations? *
Public charity.
Private foundation.
Charitable organization.
Not-for-profit organization
4. Rachel contracts with Trent to purchase $75,000 worth of goods for her store. Trent wants a clause in the contract stating that neither party will sue the other after one year from the date of breach of contract. Which of the following is true of this situation?
Competent and informed parties can agree to set any time limit to sue for breach of contract.
The UCC allows parties to shorten the time limit to bring a suit to a minimum of one year.
Parties are not allowed to provide time limits in their sales agreements, since the UCC sets this time.
The courts must review the time limits the parties have determined in the sales agreement as reasonable.