Unrelated Business Income (UBI) Planning

CliftonLarsonAllen (CLA) can help you avoid UBI tax traps and make smart decisions about your funding sources.

What’s on your mind?

• Protecting your tax-exempt status
• Diversifying revenue streams
• Managing federal and state income tax exposure
• Determining what does and doesn’t constitute UBI
• Avoiding unrelated business income tax (UBIT) surprises
• Making sense of complex UBI regulations

A unique approach

Many nonprofits generate funding from sources that aren’t directly associated with their mission-focused services, including licensing agreements, advertising, facility rental, and debt-financed income, just to name a few. This unrelated business income (UBI) is welcome revenue, but it often leads you into complex tax territory and may expose your organization to regulatory scrutiny with serious punitive consequences.

CLA’s nonprofit industry professionals can help you spot hidden UBIT traps and stay on the right side of complicated regulations. We can work with you to evaluate all your streams of revenue and recommend strategies for finding and implementing effective, low-risk income sources that help your organization thrive.

UBI tax planning services for nonprofit organizations

• UBI tax study, which includes a review of revenue streams to isolate which are considered UBI and subject to assessment
• Advisory services when seeking new revenue sources
• Cost allocation review related to net operating losses
• Form 990-T preparation