Jen: This is the PKF Texas – Entrepreneur’s Playbook®. I’m Jen Lemanski, and I’m here today with Emily Smikal, a Director in our tax department and one of the faces of the PKF Texas not-for-profit team. Emily, welcome to the Playbook.
Emily: Thanks, Jen. Thanks for having me.
Jen: So, I’ve heard you talk before about this thing called “unrelated business income tax.” How does that impact not-for-profits, and what should they know?
Emily: First, let’s call it UBI just to keep it more simple. UBIT, unrelated business income tax, is an income tax imposed on certain not-for-profit organizations that conduct certain activity that is not related to their tax-exempt purpose.
Jen: So, what would qualify for that?