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Question;1680. MC #1;Which of the following qualify as exempt organizations?;a.;Federal and related agencies.;b. Religious, charitable, and;educational organizations.;c. Civic leagues.;d. Domestic fraternal societies (e.g.;the Eagles Club).;e. All of the above can be exempt from;tax.;1681. MC #2;Which of the following are exempt organizations to which contributions made are;eligible for the charitable contribution deduction?;a.;National Basketball Association (NBA).;b. Red Cross.;c. American Institute of CPAs (AICPA).;d. Only b. and c.;e. a., b., and c.;1682. MC #3;Which of the following is not an;example of an exempt organization?;a.;Religious, charitable, or educational organization.;b. Voluntary employees? beneficiary;association.;c. Labor, agricultural, or horticultural;organization.;d. American Federation of Teachers (a;teachers? union).;e. All of the above can be exempt from;tax.;1683. MC #4;Which of the following are organizations exempt under ? 501(c)(3)?;a.;Girl Scouts of America.;b. Washington and Lee University.;c. Veterans of Foreign Wars (VFW).;d. Only a. and b. are ? 501(c)(3);organizations.;e. All of the above are ? 501(c)(3);organizations.;1684. MC #5;Which of the following is a requirement for exempt status?;a.;The organization does not exert political influence.;b. The organization has not been subject;to intermediate sanctions for the past 24 months.;c. The organization serves some type of;common good.;d. Only a. and c.;e. a., b., and c.;1685. MC #6;Rose, Inc., a;qualifying ? 501(c)(3) organization, incurs lobbying expenditures of $145,000;during the taxable year. Exempt purpose expenditures are $500,000. If Rose;makes the election under ? 501(h) to make lobbying expenditures on a limited;basis, its tax liability resulting from the lobbying expenditures is;a.;$0.;b. $7,250.;c. $11,250.;d. $36,250.;e. Some other amount.;1686. MC #7;Which of the following statements is correct?;a.;No exempt organizations can engage in any lobbying activities.;b. Certain exempt organizations can;elect to engage in lobbying activities on a limited basis.;c. Churches can engage in lobbying;activities on an unlimited basis because of the separation of church and state;provision.;d. Only b. and c. are correct.;e. Only a. and c. are correct.;1687. MC #8;Which of the following are available options for the IRS in dealing with an exempt;organization entering into prohibited transactions?;a.;Attempt to subject all or part of the organization?s income to Federal income;tax.;b. Revoke the exempt status of the;organization.;c. Impose intermediate sanctions in the;form of excise taxes.;d. Only a. and b.;e. a., b., and c.;1688. MC #9;Which of the following statements regarding intermediate sanctions is correct?;a.;Intermediate sanctions are self-assessing (i.e., calculated and paid by the;taxpayer rather than being imposed by the IRS).;b. The excise tax is imposed on the;exempt organization and on disqualified persons.;c. Both a first-level tax and a;second-level tax may apply.;d. The corporate tax rates apply in;calculating the amount of the tax liability.;e. None of the above is correct.;1689. MC #10;Which of the following activities, whose proceeds benefit an exempt;organization, are subject to the feeder organization rules?;a.;A weekly raffle operated by paid employees.;b. A car wash operated on Saturdays by;volunteers.;c. A yard sale of donated clothes.;d. A thrift shop run by volunteers.;e. None of the above is subject to the;feeder organization rules.;1690. MC #11;Which of the following activities is not subject to the feeder organization;rules?;a.;One hundred percent of the net income of the for-profit entity is contributed;to the exempt organization.;b. A trade or business where;substantially all the work is performed by volunteers.;c. A trade or business of selling;merchandise where substantially all of the merchandise has been received as;contributions or gifts.;d. Only b. and c.;e. a., b., and c.;1691. MC #12;Which of the following types of ? 501(c)(3) organizations are not private;foundations?;a.;Hospitals.;b. Churches.;c. Colleges and universities.;d. Only a. and b.;e. a., b., and c.;1692. MC #13;Which of the;following statements regarding a private foundation is not correct?;a.;Only certain exempt organizations are classified as private foundations.;b. A donor who makes a contribution to a;private foundation has identical tax consequences as a donor who makes a;contribution to a public charity.;c. A private foundation may be subject;to certain excise taxes because it is a private foundation.;d. A church is not a private foundation.;e. All of the statements are correct.;1693. MC #14;Blue, Inc., receives its support from the following sources.;Governmental unit A, for services rendered;$18,000;General public, for services rendered;45,000;Gross investment income;8,000;Contributions from individual substantial;contributors (disqualified persons);40,000;Which of the following statements is correct?;a.;Blue, Inc., is a private foundation because it satisfies the external support;test and fails the internal support test.;b. Blue, Inc., is not a private foundation because it fails both the internal and;external support tests.;c. Blue, Inc., is a private foundation;because it satisfies both the external support test and the internal support;test.;d. Blue, Inc., is not a private foundation because it satisfies both the external;support test and the internal support test.;e. None of the statements is true.;1694. MC #15;Which of the following statements is correct?;a.;A private foundation is, in general, exempt from Federal income tax.;b. A private foundation may be subject;to certain types of Federal income tax.;c. If a broad public support test is;satisfied, an exempt organization that otherwise would be classified as a;private foundation is not classified;as a private foundation.;d. Only b. and c. are correct.;e. a., b., and c. are correct.;1695. MC #16;An exempt organization can avoid classification as a private foundation if it;is broadly publicly supported. To be broadly publicly supported, which of the;following is required?;a.;The exempt organization does not receive support from a feeder organization.;b. An external support test is;satisfied.;c. An internal support test is;satisfied.;d. Only b. and c. must be satisfied.;e. a., b., and c. must be satisfied.;1696. MC #17;Which of the following taxes that are imposed on private foundations is;effectively, an audit fee to defray IRS expenses?;a.;Tax on self-dealing.;b. Tax on failure to distribute income.;c. Tax on excess business holdings.;d. Only a. and c.;e. None of the above.;1697. MC #18;Which of the following is not an;excise tax that may be imposed on a private foundation?;a.;Tax on jeopardizing investments.;b. Tax on self-dealing.;c. Tax on excessive foundation manager;compensation.;d. Tax on excess business holdings.;e. All of these taxes may be imposed on;a private foundation.;1698. MC #19;Which of the following excise taxes are imposed on the private foundation;because it engages in prohibited transactions?;a.;Tax on investment income.;b. Tax on self-dealing.;c. Tax on failure to distribute income.;d. Only b. and c.;e. a., b., and c.;1699. MC #20;Teal, Inc., is a private foundation which failed to distribute an adequate;amount of income for the exempt purpose of Teal. Which of the following;statements is correct?;a.;An excise tax in the form of an initial tax at the rate of 5% may be imposed on;Teal.;b. An excise tax in the form of an;initial tax at the rate of 2.5% may be imposed on the foundation manager.;c. An excise tax in the form of an;additional tax at the rate of 100% may be imposed on Teal.;d. An excise tax in the form of an;additional tax at the rate of 50% may be imposed on the foundation manager.;e. None of the statements is correct.;1700. MC #21;Which of the following statements is not;correct?;a.;The unrelated business income tax (UBIT) does not apply to exempt organizations that receive broad public;support.;b. The unrelated business income tax;(UBIT) treats the tax-exempt entity as if it were subject to the corporate;income tax on its unrelated business income.;c. Unrelated business income is income;derived from activities not related;to the exempt purpose of the exempt organization.;d. Only a. and c. are not correct.;e. a., b., and c. are not correct;1701. MC #22;Which of the;following requirements are among the three requirements that must be satisfied;for an exempt organization to be subject to the unrelated business income tax?;a.;The exempt organization conducts a trade or business.;b. The trade or business is not;substantially related to the exempt purpose of the organization.;c. The trade or business normally;generates an annual profit of not greater than $25,000.;d. Only a. and b.;e. a., b., and c.;1702. MC #23;Third Church operates a gift shop in its parish house. The total income of the;church is $800,000. Of this amount, $300,000 comes from offerings and $500,000;comes from the net income of the gift shop. The gift shop operations are;conducted by one full-time employee (the manager) and 50 volunteers. None of;the volunteers works more than 15 hours per week. Which of the following;statements is correct?;a.;The $800,000 is unrelated business income.;b. The $500,000 of gift shop net income;is unrelated business income.;c. The $300,000 is unrelated business;income because the gift shop is a feeder organization.;d. None of the $800,000 is unrelated;business income.;e. The unrelated business income tax;does not apply to churches.;1703. MC #24;Relevant factors in the unrelated business income tax (UBIT) rules for;determining whether a trade or business is regularly;carried on by an exempt organization do not include which of the following?;a.;The proportion of the total revenue of the exempt organization raised by the activity.;b. The frequency of the activity.;c. The continuity of the activity.;d. The manner in which the activity is;pursued.;e. All of the above are relevant;factors.;1704. MC #25;Which of the following statements are correct with respect to the unrelated;business income tax?;a.;Under certain circumstances, a corporate sponsorship payment can be classified;as not being an unrelated trade or;business.;b. Under certain circumstances, a casino;game can be classified as not being;an unrelated trade or business.;c. Under certain circumstances, the;exchanging or renting of membership lists to other exempt organizations can be;classified as not being an unrelated;trade or business.;d. Only a. and c. are correct.;e. a., b., and c. all are correct.;1705. MC #26;Which of the following are qualified corporate sponsorship payments?;a.;The amount of the payment by the corporation to the exempt organization is;contingent on the attendance at one or more events.;b. The payment by the corporation to the;exempt organization results in only a half-page advertisement in the event;program.;c. The payment by the corporation to the;exempt organization results in the corporate logo appearing in the exempt;organization?s monthly newsletter.;d. Only b. and c.;e. a., b., and c.;1706. MC #27;Which of the following requirements must be satisfied for a bingo game to be;classified as not being an unrelated;trade or business?;a.;The bingo game is legal under both state and local law.;b. The bingo game is conducted by;volunteers.;c. For-profit bingo games ordinarily are;not permitted in the jurisdiction.;d. Only a. and b. must be satisfied.;e. Only a. and c. must be satisfied.;1707. MC #28;Which of the following statements regarding low-cost articles is correct?;a.;The distribution of low-cost articles can be classified as not being an unrelated trade or business.;b. For 2011, a low-cost article is one;the costs $9.70 or less.;c. Any contributions received as the;result of the distribution of low-cost articles must be included in unrelated;business income.;d. Only a. and b. are correct.;e. a., b., and c. are correct.;1708. MC #29;Tan, Inc., a tax-exempt organization, has $65,000 of net unrelated business;income. Total charitable contributions (all associated with the unrelated trade;or business) are $7,500. Assuming that the $7,500 was deducted in calculating;net unrelated business income, what is Tan?s unrelated business taxable income?;a.;$57,500.;b. $65,250.;c. $66,000.;d. $72,500.;e. Some other amount.;1709. MC #30;Swan, Inc., a;tax-exempt organization, leases a building and equipment to ABC Corporation.;The rental income from the building is $240,000 and from the equipment is;$18,000. Rental expenses are $150,000 for the building and $16,500 for the;equipment. What adjustment must be made to net unrelated business income?;a.;$0.;b. ($16,500).;c. ($18,000).;d. ($91,500).;e. Some other amount.;1710. MC #31;For purposes of the unrelated business income tax (UBIT), land that is acquired;by the exempt organization for later exempt-use is excluded from the definition;of debt-financed property if certain requirements are satisfied. Which of the;following is not included in the;requirements?;a.;The principal purpose of acquiring the land is for use (substantially all) in;achieving the organization?s exempt purpose.;b. The fair market value of the land is;not over 50% of the fair market value of land presently owned by the exempt;organization.;c. The use of the land by the exempt;organization will begin within ten years of the acquisition date.;d. At the date the land is acquired, it;is located in the neighborhood of other property of the organization for which;substantially all the use is for achieving the organization?s exempt purpose.;e. All of the above are requirements.;1711. MC #32;Which of the;following is one of the requirements that will enable mortgaged land acquired;by an exempt organization for later exempt use to be excluded from;debt-financed property, for purposes of the unrelated business income tax?;a.;The principal purpose of acquiring the land is for investment.;b. The land is used within ten years of;the acquisition date in the organization?s exempt purpose.;c. The land is located in the United;States.;d. Only a. and b.;e. None of the above.;1712. MC #33;Acquisition indebtedness consists of the unpaid amounts of which of the;following for debt-financed property?;a.;Debt incurred in acquiring or improving the property.;b. Debt incurred to enable the;organization to carry out its exempt purpose.;c. Debt incurred to enable the exempt;organization to acquire a feeder organization.;d. Only a. and b.;e. a., b., and c.;1713. MC #34;Which of the following are consequences of tax-exempt status?;a.;Not necessary to file a Federal income tax return.;b. Generally exempt from Federal income;tax.;c. Contributions to the exempt;organization are deductible by the donor.;d. Only b. and c.;e. a., b., and c.;1714. MC #35;Which of the following exempt organizations are required to file Form 990;(Return of Organization Exempt from Income Tax)?;a.;Federal agencies.;b. Churches.;c. Private foundations.;d. None of these entities must file Form;990.;1715. MC #36;Which of the following statements are correct?;a.;If an exempt organization has annual gross receipts of less than $50,000, it;does not file Form 990 (Return of Organization Exempt from Federal Income Tax).;b. Private foundations must file Form;990-PF (Return of Private Foundation).;c. If the gross income from an unrelated;trade or business is less than $1,000, it is not necessary to file a return;associated with the unrelated business income tax.;d. Only a. and c. are correct.;e. a., b., and c. are all correct.;1716. MC #37;Which of the following statements regarding exempt organization filing;requirements is incorrect?;a.;Churches are required to file Form 990 (Return of Organization Exempt from;Income Tax) only if its annual gross receipts exceed $50,000.;b. The due date for Form 990 (Return of;Organization Exempt from Income Tax) is the fifteenth day of the fifth month;after the end of the taxable year whereas for private foundations the due date;for Form 990-PF (Return of Private Foundation) is the fifteenth day of the;fourth month after the end of the tax year.;c. All exempt organizations whose annual;gross receipts do not exceed $50,000 can file Form 990-N (the ?e-Postcard?).;d. Only a. and b. are incorrect.;e. a., b., and c. are incorrect.;1717. MC #38;Which of the following statements regarding the disclosure Regulations is;correct?;a.;Posting the required tax forms on the Internet is an acceptable technique for;satisfying the ?widely available requirement.?;b. Forms 990 and 1023 must be readily;available to the general public.;c. If an individual requests a copy of;the required tax forms in writing, the exempt entity must provide a copy within;30 days.;d. Only a. and b. are correct.;e. a., b., and c. are all correct.;1718. MC #39;To maintain exempt status, an organization must do which of the following;a.;Satisfy only an organizational test.;b. Satisfy only an operational test.;c. Satisfy both an organizational test;and an operational test.;d. Satisfy a financial test.;e. Once exempt status is granted, it;will continue regardless of whether the organizational test and the operational;test are satisfied.

 

Paper#59283 | Written in 18-Jul-2015

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