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 2018, a low-cost article is one that costs $10.80 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 generally not considered an unrelated trade or business.

Option B is also correct as for 2018, the IRS defines a low-cost article as an item that is $10.80 or less.

Option C is incorrect, as contributions received from the distribution of low-cost articles are generally not considered unrelated business income under IRS regulations.

Therefore, the correct answer is D, only options A and B are correct.

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