P2-U17 · PART 2 · SOURCE CYCLE 2026-2027
Tax-Exempt Organizations
How to complete this unit
This unit uses 15 source-gated recall cards and 15 admissible practice questions. Complete the sequence in order; the unreleased wiki prose remains outside the learner path.
- 1 · LearnBuild the rule
Answer each recall prompt before opening it. Then learn the exact rule, test the controlling facts through four quick challenges, explore common questions, and finish with one own-words teach-back.
- 2 · ApplyUse it in context
Complete at least 15 mapped questions over two sessions. Review the explanation even when the answer is correct.
- 3 · ProveTest readiness
Use the Part 2 mock under time pressure. Return here for every flagged or missed concept before the next attempt.
Verified recall questions
Only cards whose complete question and answer were checked against exact primary-authority evidence appear here. Stable unit ownership gathers this lesson across 1 textbook collection.
Q1.Alder, an eligible exempt organization, has $150,000 of annual gross receipts and $400,000 of year-end assets. Which return may generally be available?
Form 990-EZ
Q2.The Alaskan Bird Rescue is a 501(c)(3) organization that is dedicated to saving wild birds. The organization was newly formed this year. What form must the organization file in order to request formal exemption from the IRS?
Form 1023
Q3.How must an exempt organization calculate unrelated business taxable income if it has more than one unrelated business activity?
Separately calculate unrelated business taxable income for each unrelated business activity
Q4.Which of the following tax-exempt organizations are eligible to file Form 990-EZ?
An organization with gross receipts of less than $200,000 a year and total assets at the end of the year of less than $500,000.
Q5.The Smith Family Foundation is a 501(c)3 private foundation founded by Bill and Betty Smith. The Smith Family Foundation is dedicated to the support and promotion of educational purposes for low-income families and impoverished children. The foundation had $90,000 in gross receipts for the year, and $100,000 in assets. Which annual tax form is the Smith Family Foundation required to file?
Form 990-PF
Q6.The Georgia Literary Association is an organization that fosters literacy programs for children and their parents. Which form should the organization use to apply for formal tax exemption under IRC section 501(c)(3)?
Form 1023
Q7.Which of the following acts may cause an exempt organization to lose its 501(c)(3) tax-exempt status?
Participating in a political campaign on behalf of a candidate running for public office.
Q8.Which of the following exempt entities is permitted to file a Form 990-N, e-postcard?
A public charity with gross receipts that are less than $50,000.
Q9.Which of the following statements about churches is correct?
A church is not required to file an annual information return.
Q10.Which kind of organization is allowed to file a Form 990-N, e-postcard?
A nonprofit with gross receipts of $50,000 or less.
Q11.An organization's tax-exempt status will be revoked if it fails to file required information returns for ____ years in a row.
Three.
Q12.Every tax-exempt entity must have ____, regardless of whether it has employees.
An employer identification number.
Q13.Child Rescue Inc. is a calendar-year nonprofit organization that helps prevent child abuse. It is required to file Form 990. What is the due date of its tax return, not including extensions?
May 15.
Q14.Which of the following organizations does not qualify for tax-exempt status?
An educational partnership.
Q15.The Immaculate Heart Church of Sacramento has two employees: Guadalupe, who works as a secretary in the church rectory, and Mauricio, who is the church custodian. Which return(s) must the church file in order to fulfill its IRS reporting obligations?
Form 941.
Ready to move on?
- ▸ Explain at least 80% of these 15 rules without opening the answer, twice on different days.
- ▸ Score 80% across 15 or more mapped questions over two sessions, not one memorized round.
- ▸ Complete a timed Part 2 mock and return to this unit if its concepts remain flagged or missed.
Use these checks to choose your next study action. They do not predict a PSI scaled score.