Detailed Answer
(a) The filing of a return covering unrelated business
income (Form 990-T) is required of all exempt organizations
having at least $1,000 of unrelated business taxable income for
the year. However, this does not relieve the organization of having
to file a separate information return (Form 990) if it is otherwise
required to file. Answer (c) is incorrect because in determining
whether income is unrelated business income, the exempt
organization’s need for the income or the use it makes of the
profits is irrelevant. Answer (d) is incorrect because the tax on
unrelated business income of exempt organizations must be paid
in full with the return.