Which of the following statements regarding low-cost articles is correct?
A) The distribution of low-cost articles can be classified as not being an unrelated trade or business.
B) For 2011, a low-cost article is one the costs $9.70 or less.
C) Any contributions received as the result of the distribution of low-cost articles must be included in unrelated business income.
D) Only a. and b. are correct.
E) a., b., and c. are correct.

Question

Quizplus · Accepted Answer

Option A is correct as the distribution of low-cost articles is related to the exempt purpose and is not considered an unrelated trade or business.
Option B is correct as per IRS guidelines for 2011.
Option C is incorrect as contributions received as a result of the distribution of low-cost articles are not included in unrelated business income. Hence, option E is incorrect.
Therefore, option D is the correct answer.

Which of the Following Statements Regarding Low-Cost Articles Is Correct