BarbriSFCourseDetails
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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Accounting

Date & Time
  • event Date

    Tuesday, August 23, 2022

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    110 minutes

Credit Information

  • BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.

  • BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).

$197.00
CPE
ALL

This course will give nonprofit advisers and tax professionals a practical guide to the rules governing joint ventures between tax-exempt organizations and for-profit entities. The panel will discuss the control requirements for determining the tax treatment of joint venture proceeds, detail the UBTI rules as they apply to joint ventures, and offer valuable tools for helping exempt organizations avoid IRS sanctions for prohibited activities.

Faculty

Ryan Oberly
Partner
Wagenmaker & Oberly, LLC

Mr. Oberly is a partner in the firm and represents a diverse group of tax-exempt organizations, including public charities, private foundations, religious and educational institutions, trade associations, social clubs, and social enterprises. From start-ups to complex corporate and tax planning, he works with clients to protect tax-exempt status, facilitate organizational growth, and manage risks. He has successfully represented clients in IRS audits, state attorney general investigations, and other diverse crisis situations.

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Elka T. Sachs
Partner
Krokidas & Bluestein, LLP

Ms. Sachs concentrates her practice on the corporate, transactional and tax needs of the firm’s clients. She represents non-profit and public entities, including health and human service providers, charter schools and other educational institutions, and financial institutions which lend to non-profits and public entities.

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Description

Joint ventures between tax-exempt organizations and for-profit entities have long been a feature of many health organizations and continue to increase in popularity among broader segments of the nonprofit sector. The Internal Revenue Code permits these joint ventures under certain conditions. Failure to abide by the joint venture rules could lead to the exempt organization being subject to tax on UBTI or even the loss of exempt status.

Tax-exempt entities engaged in joint activities with for-profit companies generally must be able to meet two criteria for any income from the joint venture to be treated as exempt. First, the joint venture must serve primarily to further the charitable purpose of the exempt organization. The second requirement is that the operating agreement must explicitly provide that the primary goal of the joint venture is the advancement of the tax-exempt mission and only incidentally for the benefit of the for-profit partner or subsidiary and must be structured to ensure that the primary goal can be fulfilled.

Tax advisers and nonprofit officers must have a practical grasp of available joint venture structures and their possible advantages and risks to avoid costly tax consequences.

Listen as our experienced panel provides a practical guide to joint venture structures' operational and tax impact between exempt organizations and for-profit companies.

Outline

  1. The IRS position on exempt/non-exempt joint ventures
  2. Criteria for documenting exempt organization control over joint venture operations
  3. Available structures for exempt/non-exempt joint ventures
  4. Alternative approaches to affiliation
  5. UBTI rules as applied to joint ventures and other affiliations
  6. Structuring suggestions

Benefits

The panel will discuss these and other relevant topics:

  • Necessary elements of a joint venture agreement between an exempt organization and a for-profit company to avoid risk to the nonprofit entity
  • Risks beyond UBTI for an exempt organization operating a joint venture
  • Alternatives to a formal joint venture that an exempt organization may consider in partnering with for-profit entities
  • Avoiding UBTI and excess benefit issues in exempt/non-exempt joint ventures

NASBA Details

Learning Objectives

After completing this course, you will be able to:

  • Recognize defects in joint venture structures that present possible tax costs or exempt status risk to exempt organizations
  • Discern critical terms that must be part of any exempt/non-exempt joint venture operating agreement
  • Identify alternatives to formal joint ventures between exempt organizations and for-profit companies
  • Determine documentation requirements to defend against IRS scrutiny of joint venture arrangements
  • Decide advantages of various joint venture and subsidiary structures

  • Field of Study: Taxes
  • Level of Knowledge: Intermediate
  • Advance Preparation: None
  • Teaching Method: Seminar/Lecture
  • Delivery Method: Group-Internet (via computer)
  • Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
  • Prerequisite: Three years+ business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules; supervisory authority over other preparers/accountants. Specific knowledge and understanding of UBTI and UBIT for Form 990 T.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).