Earnings that may not be exempt.
Nonprofit organizations sometimes engage in activities that produce revenue considered to be commercial, and therefore taxable. Because this unrelated business income (UBI) is outside the normal scope of operations, it may not qualify for inclusion under the entity’s tax-exempt status. Firms need to proceed with caution with these types of activities.
BDO professionals are experienced with all aspects of the complex UBI laws, current IRS guidance, and industry standard practices. We ensure our clients are compliant and timely with their filings and take a proactive approach to both current and future transactions.