Non-Profits and Unrelated Business Income Tax: Evaluating Non-Core Revenue Streams

Description

Non-profits and how they raise funds are under tax scrutiny as never before. Rough economic times are forcing the IRS and state revenue departments to become increasingly aggressive and sophisticated in policing activities that can trigger a tax bill on unrelated business income tax (UBI).

On the federal side, non-profits and their advisors now face ramped-up IRS compliance initiatives, an updated Publication 598, the chief UBI tax guidance document, as well as required public disclosure of their Form 990-Ts. The IRS is much more skeptical about permissible non-profit activities.

Meanwhile, several states have recently moved to either taxing unrelated business income for the first time or becoming stricter about what constitutes UBI. Non-profits and their outside accountants must plan with the expectation of both federal and state tax challenges.

Listen as our panel of experienced non-profit tax advisory specialists brings you up to speed on current UBI tax policies at the federal level and in major states. The panel will outline approaches for reviewing non-profits' business models and preparing for compliance initiatives.

Outline

1. Developments at the federal level
   1. Current tenor of IRS oversight
   2. Changes in Form 990-T (non-profit business income tax return and instructions)
      1. Effective with 2008 tax year reports
      2. New 11-page core form
      3. Number of new schedules
      4. New reporting on governance and compensation of officers, directors, trustees and key employees
   3. Latest amendments to federal Sect. 301-6104(d)
      1. When non-profits must produce federal returns for public inspection
      2. “Return” to be produced must include exact copy of Form 990-T plus all schedules, attachments and supporting documents
      3. Charities make Form 990-T available for three years starting on last day
   4. Last revisions to IRS Publication 598
      1. Qualifying specified payments from controlled entity included in UBI tax only for amount that would have been paid or accrued under Sect. 482
      2. Requirement to make Form 990-T available
2. Developments at the state level
   1. North Carolina, Louisiana, Massachusetts change policies on what constitutes unrelated business income or whether to tax it
   2. Other recent examples of key changes in state UBI tax policy
3. Recommended approaches for non-profits to adjust to federal, state changes

Benefits

The panel will provide clear examples of what will and won't be considered unrelated business income to prepare you to do a more thorough job preparing clients for these and other key areas:

• Planning in response to latest federal and state UBI standards.
• Knowing which non-profit activities could trigger a tax bill.
• Strategizing for more difficult federal and state revenue agency compliance initiatives.
• Preparing more exacting Form 990-Ts and state returns, when necessary.
• Adjusting to new federal public disclosure requirements on Form 990-T.

CPE Credit

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CLE Credit

Strafford's live seminars qualify for CLE in every state that accredits webinars. They offer you a high quality, cost effective, and convenient CLE option, with no lost travel time or expenses.

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