The non-profit institution must satisfy the following requisites to be a qualified donee that is exempt from donor's tax, except paying no dividends generates no revenue governed by trustees incorporated as a non-stock entity
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The non-profit institution must satisfy the following requisites to be a qualified donee that is exempt from donor's tax, except
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- 1. Under the constitution: Prohibition against taxation of non-stock, non-profit [educational] institutions. This exempts from taxes all revenues and assets of non-stock, non-profit educational institutions actually, directly and exclusively used for educational purposes. Exemption from taxes refers to a. RPT b. Income tax c. Donor s tax d. All of the above 2. RPT exemption covers charitable institutions, churches, and parsonages or convents appurtenant thereto, mosques and non-profit cemeteries and all lands, buildings and improvements actually, directly and exclusively used for charitable, religious and educational purposes. Charitable institution refers to a. Church providing free religious advices b. Entities providing goods and services for free c. Both a and b d. None of the above 3. Income Tax is an example of a. Personal tax b. Business tax c. Property tax d. Excise tax e. Indirect tax f. None…What is the best definition of an S Corporation? A. Type of nonprofit that is not required to pay certain types of taxes B. Private-public corporation that meets certain requirements for tax exemption C. Type of for-profit business that also has a social mission D. Type of corporation with pass-through taxation on incomeWhich of the following statements is correct? Endowments are provided as donations which only allow a not-for-profit organization to invest in. other not-for-profit organizations only. Endowments are donations that are received with the provision that it will be invested and only the investment income may be spent by the organization. O Endowments may be restricted and unrestricted funds which must be used in accordance with the wishes of the contributor and only available during the life of the donor. Endowments are unrestricted donations which can be used for any purposes that are consistent with the goals and objectives of the not-for-profit organization.
- Under FASB standards, expenses of a not-for-profit organization can only be shown as reductions of net assets without donor restrictions. O True O FalseWhich of the following least likely distinguishes nonprofits from for-profit corporations? a) Profit generation. b) Tax payments. c) Number of shareholders and dividend payments.Which statement below best describes the entities that can accept donations from the public and provide donors with documentation to allow them to claim a tax deduction in respect of their donation? a. A local state school. b. A private hospital. c. Only entities classified as a deductible gift recipient (DGR) as they meet the necessary requirements to be registered by the ATO. d. Any not for profit organisation.
- For federal income tax purposes, what term refers to the business entity not being a separate entity from the owners? This type of entity is not taxed but the owner(s) must record the earnings from the business on his/her individual income tax return. Group of answer choices pass-through entity non-profit entity election entity mutual entityWhich of the following characteristics identify a nonprofit as it relates to tax-status? (Choose all that apply.) Select one or more: a. They don't generate profit that gets reinvested into their mission. b. They are governed by a compensated board of directors c. They are primarily funded by membership fees d. They have a mission that is based around serving the public needZZZ is a non-stock and non-profit educational institution. Which of the following is TRUE? * Its income from related activities is exempt from income tax. Its income from unrelated activities is exempt from income tax. Both income from related and unrelated activities are subject to income tax. None of the above
- The following questions concern the accounting principles and procedures applicable to a private not-for-profit entity. Write answers to each question. What is the difference between revenue and public support? What is the significance of the statement of functional expenses? What accounting process does a private charity use in connection with donated materials? What is the difference in the two types of restricted net assets found in the financial records of a private not-for-profit organization? Under what conditions should the entity record donated services? What is the proper handling of costs associated with direct mail and other solicitations for money that also contain educational materials? A not-for-profit receives a painting. Under what conditions can this painting be judged as a work of art? If it meets the criteria for a work of art, how is the financial reporting of the entity affected?Which of the following is true regarding a not-for-profit organization’s reporting of gains and losses on investments purchased with permanently restricted assets?a. gains and losses can only be reported net of expenses in the statement of activities.b. unless explicitly restricted by donor or law, gains and losses should be reported in the statement of activities as increases or decreases in unrestricted net assets.c. gains may not be netted against losses in the statement of activities.d. unless explicitly restricted by donor or law, gains and losses should be reported in the statement of activities as increases or decreases in permanently restricted net assets.Which of the following is tax exempt on its income earned as such? Religious corporation organized as non-stock Non-stock, non-profit educational institution Government educational institution Government owned and controlled corporation