Who Pays UBIT?

Data from 2008 IRS Form 990s show what types of associations pay the most unrelated business income tax (UBIT).

Associations tread carefully when it comes to income from sources that don't have a direct connection to their mission: Unrelated business income tax rules can be complicated, and the association's tax-exempt status can be at stake. According to the ASAE Foundation's Association 990 database, a strong majority (67 percent) did not report UBIT of $1,000 or more on 2008 IRS Form 990s. Still, 501(c)(6) organizations (which generally comprise trade associations) and associations with large staffs are more likely than average to pay such tax. For more information, visit www.asaefoundation.org.

Organizations Reporting UBIT of $1,000 or More

By Tax-Exempt Status

501(c)(3):

18%

501(c)(6):

44%

 

By Number of Employees

30 or more:

48%

11 to 29:

32%

1 to 10:

22%