Summary
For our study, The Chronicle reviewed the most recent 990-T tax forms of dozens of prominent charities-a cross-section of nonprofit organizations like Harvard University, the American Red Cross, the Salvation Army, the National Geographic Society, the Christian Broadcasting Network, and the Metropolitan Museum of Art. While the federal law states that some forms of charities' commercial income are taxable-like advertising revenue from magazines and journals that nonprofit groups regularly publish, as well as income from insurance policies that they offer-the law also includes more than two dozen separate exemptions that allow organizations to shelter such income.
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Extract
Journalists Can Tap the Irs 990-T to Review Business Earnings of Nonprofits
When a charity receives a donation, it does so entirely tax free.
However, when that same charity collects money from a business-like activity, such as selling an advertisement in a magazine, charging visitors to park, or renting out its facilities for a special event, it is required to pay tax on that income.That tax-called unrelated business income tax by the Internal Revenue Service-is on the books to prevent charities from enjoying an unfair competitive edge over for-...See the full content of this document
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