Being totally new to the CPA exam game, I really am never sure what I'm supposed to know and not know. For example, this was part of the Becker homework for tax exempt entities:
Which one of the following types of organizations qualifies as an organization exempt from income tax?
a. All "feeder" organizations, primarily conducting business for profit, but distributing 100% of their profits to organizations exempt from income tax.
b. An "action" organization established for the purpose of influencing legislation pertaining to protection of animal rights.
c. An organization whose purpose is to foster national or international amateur sports competition by providing athletic facilities and equipment.
d. A social club organized and operated exclusively for the pleasure and recreation of its members, supported solely by membership fees, dues, and assessments
D is correct. I was curious to see why C was wrong and Google got me to this:
The Tax Reform Act of 1976 amended IRC 501(c)(3) to exempt from federal income taxation organizations organized and operated exclusively to foster national or international amateur sports competition, provided they do not furnish athletic facilities or equipment. The statute was amended in 1982 by adding IRC 501(j).
Geeeez there was no mention of that specific thing in Becker. Is anyone supplementing their studies with reading the code/regs? I do have an amended version in my house from school. Is stuff like this fair game and what can I do about it?