Unrelated Business Income
Although the University generally is exempt from income tax, it is subject to tax on certain activities that may generate unrelated business income (UBI).
An activity generates UBI if:
- it is a trade or business,
- regularly carried on, and
- does not substantially relate to the exempt purpose of the organization.
There are many exceptions and special circumstances that may cause a revenue stream to be deemed UBI or exempted from tax. The tax associated with the UBI activity may be charged back to the applicable unit.
If you think your unit is engaged in UBI-generating activities, please contact us as soon as possible.