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Form 990-T Schedule A - Unrelated Business Income

- Updated June 21, 2021 - 8.00 AM - Admin, ExpressTaxExempt

Form 990-T is to report the Unrelated Business Income by the Tax exempt organizations. It provides information about the unrelated trade or business of the organization.

1. What is Form 990-T schedule A?

Form 990-T Schedule A is filed by exempt organizations engaging in one or more unrelated trades or business to report income and allowable deductions for unrelated trades
or businesses.

2. Who needs to attach Form 990-T Schedule A?

Tax-Exempt Organizations are required to attach Form 990-T Schedule A if they engage in one or more unrelated trade or business and file Form 990-T. Organizations use a separate Schedule A to report income and allowable deduction for each separate unrelated trade.

3. Form 990-T Accounting method

An organization’s accounting method is the process they use for reporting revenue and expenses. The two primary
accounting methods are accrual accounting (generally used by organizations) and cash accounting (generally used by individuals).

4. Instructions to complete Form 990-T Schedule A

Our step-by-step instructions are here to help you file Form 990-T Schedule A.

Instructions to complete Form 990-T Schedule A Part I. Unrelated Trade or Business Income

Instructions to complete Form 990-T Schedule A Part I. Unrelated Trade or Business Income

Line 1-13 is about the unrelated business income your organization acquired for the tax year.

Enter the values of gross receipts or sales, cost of goods, unrelated business income, investment income, and other income in the following columns:

  • Income
  • Expenses
  • Net

Trust organizations should report their capital gains and losses on Schedule D (Form 1041), whereas corporations must report them on Schedule D (Form 1120). If the organization has gains and losses to report other than capital assets, it must report them on Form 4797, Sales of Business Property.

Instructions to complete Form 990-T Schedule A Part II. Deductions Not
Taken Elsewhere

Instructions to complete Form 990-T Schedule A Part II. Deductions Not Taken Elsewhere

Line 1 to 18 of Part II requires information about the various expenses and contributions that the organization made for the taxable year. This includes compensation of officers, directors, trustees, salaries, wages paid, employee benefit programs, and other deductions. Both corporation and trust organizations can file Form 4562, Depreciation and Amortization to report information besides the depreciation value.

  • In Line 15, Total deductions, add the values of lines 1 through 14 and enter
    their sum.
  • In Line 18, Unrelated business taxable income, subtract line 17 from line 16 and enter the value.

Instructions to complete Form 990-T Schedule A Part III. Cost of Goods Sold

Instructions to complete Form 990-T Schedule A Part III. Cost of Goods Sold

Part III requires the value of the difference in inventory from the beginning to the end of the year. Enter this value on Line 8, Cost of goods sold, of Form 990-T Schedule A.

Generally, inventories are required at the beginning and end of each tax year, if the production, purchase, or sale of merchandise is an income-producing factor.

Instructions to complete Form 990-T Schedule A Part IV. Rent Income (From Real Property and Personal Property Leased with Real Property)

Instructions to complete Form 990-T Schedule A Part IV. Rent Income (From Real Property and Personal Property Leased with Real Property)

Part IV requires information about the gross rental income received or accrued by your organization for the taxable year.

All organizations that have applicable rent income, other than section 501(c)(7), (9), and (17) organizations, should complete Schedule A, Part IV. Section 501(c)(7), (9), and (17). Organizations should enter gross rents on Schedule A, Part I, line 6 and applicable expenses on Schedule A, Part II, lines 1 through 14.

Instructions to complete Form 990-T Schedule A Part V. Unrelated Debt-Financed Income

Instructions to complete Form 990-T Schedule A Part V. Unrelated Debt-Financed Income

This part is used to compute unrelated debt-financed income described in Sections 512(b)(4) and 514 from debt-financed properties. Part V only reports on this income when it doesn’t constitute income from the conduct of an unrelated trade or business and isn't specifically taxable under other
provisions of the Code.

This includes income such as taxable rents from personal property leased with real property (reportable on Schedule A, Part IV and Schedule A, Part I, line 6), or taxable interest, annuities, royalties, and rents from a controlled entity (reportable on Schedule A, Part VI and Schedule A, Part I,
line 8).

Instructions to complete Form 990-T Schedule A Part VI. Interest, Annuities, Royalties, and Rents from Controlled Organizations

Instructions to complete Form 990-T Schedule A Part VI. Interest, Annuities, Royalties, and Rents from Controlled Organizations

Part VI requires information regarding interest, annuities, royalties, and rents from
controlled organizations.

Under section 512(b)(13), interest, annuities, royalties, and rents received or accrued (directly or indirectly) by a controlling organization from a controlled organization are subject to tax. These amounts are still taxable, whether or not the activity that the controlling business conducts to earn them is regularly conducted or is a trade or business.

Instructions to complete Form 990-T Schedule A Part VII. Investment Income of a Section 501(c)(7), (9), or (17) Organization

Instructions to complete Form 990-T Schedule A Part VII. Investment Income of a Section 501(c)(7), (9), or (17) Organization

Part VII requires information about your organization's investment income. Report all income from investments in securities and other similar investment income from nonmembers. This includes 100% of income and directly related expenses from debt-financed property.

Instructions to complete Form 990-T Schedule A Part VIII. Exploited Exempt Activity Income, Other Than Advertising Income

Instructions to complete Form 990-T Schedule A Part VIII. Exploited Exempt Activity Income, Other Than Advertising Income

This part requires information about your organization’s exploited exempt activity income.

Exempt organizations with gross income from an unrelated trade or business activity that exploits an exempt activity (other than periodical advertising income reportable in Schedule A Part IX) must complete this part of 990-T Schedule A.

Instructions to complete Form 990-T Schedule A Part IX. Advertising Income

Instructions to complete Form 990-T Schedule A Part IX. Advertising Income

Line 1 to 8 of Part IX requires information about your organization’s advertising income. Exempt organizations that earned gross income from advertising in exempt organization periodicals must complete Schedule A, Part IX of this form.

Instructions to complete Form 990-T Schedule A Part X. Compensation of Officers, Directors,
and Trustees

Instructions to complete Form 990-T Schedule A Part X. Compensation of Officers, Directors, and Trustees

This part requires information on the compensation made to your organization’s Officers,
Directors, and Trustees.

Enter the required details about your officers, directors, and trustees in the following columns:

  • Name
  • Title
  • Percentage of time devoted to business
  • Compensation attributable to unrelated business

Instructions to complete Form 990-T Schedule A Part XI. Supplemental Information

Instructions to complete Form 990-T Schedule A Part XI. Supplemental Information

This part requires information on your organization’s operations. It also allows you to provide information on lines that don’t have an embedded attachment, information to supplement embedded attachments, or any other information about amounts reported on Schedule A.

Suppose an organization associated its unrelated trade or business activity with a different NAICS or Business Activity Code during a prior year than the one shown on Schedule A for the current tax year. They should use Part XI to provide
an explanation.

Why E-File Form 990-T with Schedule A with ExpressTaxExempt?

When you start filing Form 990-T, you can attach Schedule A
for FREE.

Our internal audit check feature will review your Form for any errors, and ensure the transmission of error-free returns. Then you can transmit your Form to the IRS securely.

As we are an IRS Authorized software, we provide a safe, secure, and accurate
filing experience.


E-file your Form 990-T with ExpressTaxExempt

Accurate and Secure Filing

Accurate and Secure Filing

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IRS Authorized E-File Provider

Helpful Instructions at each step

Helpful Instructions at each step