Join the waitlist

UBIT CalculatorUnrelated Business Taxable Income and Form 990-T Tax

What does this come to under the current IRS rules?

Unrelated business taxable income by separate trade or business, the $1,000 specific deduction, the 21 percent corporate tax and the Form 990-T filing test.

  • Runs in your browser
  • Nothing stored or sent
  • Free, no sign-up
Your figures
Example figuresIllustrative only. Type over them with your own.
Tax at 21 percent
$6,720
Corporate rate on unrelated business taxable income
Unrelated business taxable income after the specific deduction
$32,000
Sum of positive results by trade or business
$33,000
Drawn to one scale
Tax at 21 percent$6,720
Unrelated business taxable income after the specific deduction$32,000
Sum of positive results by trade or business$33,000
Losses that cannot offset another trade or business this year$5,000
Specific deduction used$1,000
Gross income from unrelated trades or businesses$99,000
All results
MeasureResult
Tax at 21 percent$6,720
Unrelated business taxable income after the specific deduction$32,000
Sum of positive results by trade or business$33,000
Losses that cannot offset another trade or business this year
Each loss is tracked as its own net operating loss
$5,000
Specific deduction used$1,000
Gross income from unrelated trades or businesses$99,000
Form 990-T requiredYes: gross income of $1,000 or more
How this was worked out
Work shownrecomputed as you type
Result by trade or business = gross income - directly connected deductions, computed separately (section 512(a)(6))
UBTI = sum of positive results - $1,000 specific deduction (not below zero)
Tax for a corporation = UBTI x 21%

Illustrative arithmetic on the figures you enter. Check the result against your firm's methodology before relying on it.

The formulas

  • Result by trade or business = gross income - directly connected deductions, computed separately (section 512(a)(6))
  • UBTI = sum of positive results - $1,000 specific deduction (not below zero)
  • Tax for a corporation = UBTI x 21%

How it works

An exempt organization with more than one unrelated trade or business computes unrelated business taxable income separately for each, so a loss in one cannot reduce income from another. The total of the positive results is reduced by one specific deduction of $1,000 under section 512(b)(12), and a corporation multiplies the result by 21 percent on Form 990-T Part II.

An organization must file Form 990-T if it has gross income of $1,000 or more from a regularly conducted unrelated trade or business, where gross income is gross receipts minus cost of goods sold. Trusts use the trust rate schedule instead of 21 percent; this tool covers corporations. It does not apply net operating loss carryovers, the charitable contribution deduction or credits.

Illustrative figures only. Check the result against your firm's methodology before relying on it.

Common questions

Can a loss in one activity offset income in another?

Not in the same year. Under section 512(a)(6) each trade or business is computed separately and a loss carries forward within that trade or business.

Is the $1,000 deduction per activity?

No. Only one specific deduction is taken regardless of the number of unrelated businesses, except for certain church and religious order local units.

Sources

Runs in your browser. The figures you type are not sent to CORAA or stored. Check the result against your firm's methodology before relying on it.

Related audit calculators

CalculatorPublic Support Test Calculator: 33 1/3 Percent and 10 Percent Facts and CircumstancesSchedule A Part II public support percentage for a section 170(b)(1)(A)(vi) organization, with the 2 percent donor limit applied.CalculatorSection 509(a)(2) Support Test Calculator: Public Support and Investment IncomeSchedule A Part III public support percentage and investment income percentage, each tested against one-third.CalculatorQuid Pro Quo Contribution Calculator: Deductible Amount and $75 DisclosureDeductible part of a payment that buys goods or services, whether the written disclosure is required, and the penalty for missing it.
For US CPA firms

Join the CORAA waitlist

CORAA AI drafts audit working papers from your client’s QuickBooks books and does the first pass: lead schedules, tie-out, memos, draft notes and letters. CORAA Network reviewers clear every finding. Your firm reviews and signs.

  • First audit free, so you can judge the quality on a real file
  • Flat fee by entity size; messy books included
  • We work only with CPA firms, never their clients
See how it works →

* required