Unrelated business income taxes (UBIT) in a nutshell

Most not-for-profits (NFPs) are founded to provide some public benefit. Tax-exempt status refers to the federal income tax exemption that is available for certain kinds of income under section 501(a) of the Internal Revenue Code (IRC). NFPs that have obtained tax-exempt status from the IRS are referred to as tax-exempt organizations or simply exempt organizations (EOs). The benefits of exempt status include exemption from federal income tax on income related to the organization’s exempt purpose and, for some entities, the