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Organizational tax is a factor that every organization must face. Some organizations qualify for exemptions while other do not. Tasks: Analyze the requirements of an organization to qualify for...

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Organizational tax is a factor that every organization must face. Some organizations qualify for exemptions while other do not.



Tasks:



  • Analyze the requirements of an organization to qualify for exemption.

  • Assess which taxes a private foundation may be subject to.

  • Explain what code section entities organized and operated exclusively for religious, charitable, and education purpose are exempt from Federal income taxation.


Submission Details:



  • Compose a 2–3 page paper in Microsoft Office Word answering the questions:

Answered 1 days After Dec 07, 2022

Solution

Prince answered on Dec 08 2022
48 Votes
1. Organizational Requirements to Meet the Criteria for Exemption
The US offers tax exemptions to groups that meet the requirements, such as 501(c)(3) entities. These organisations were founded and run only for philanthropic, educational, and religious purposes. The organisation must fulfil the IRC's exemption conditions in order to be eligible for an exemption. The Internal Revenue Service must receive an application from the exempt groups first (IRS). The organization's compliance with the IRS's regulations must be demonstrated in this application.
The IRS mandates that the organisation be established and run solely for charitable, educational, and religious purposes. To meet this requirement, the IRS examines the organization's organizing documents, such as its Articles of Incorporation and its mission statement. The documents must explicitly state the organization's exempt purposes. The organization must also demonstrate that it operates exclusively for these purposes, i.e. no part of their activity or earnings can benefit private individuals. Furthermore, the organization must be operated on a not-for-profit basis.
In addition, the organization must provide evidence to the IRS. This may include providing annual financial statements, articles of incorporation or trust documents that show that the organization is organized and operated...
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