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  5. Unrelated Business Income Tax
  6. Unrelated Business Income Tax (UBI)

Unrelated Business Income Tax (UBI)

Overview

The University of Florida, as a governmental unit, is not taxed on its income from an activity substantially related to the educational, or other purpose that is the basis for the organization’s exemption.  For University of Florida, higher education, research/scholarship, and service are the basis of its exemption related to its mission.

However, the University is required to pay Federal income tax on net income from activities deemed unrelated to the exempt mission of the University.

UBI Certification

The Auxiliary/EBA Office conducts a review of college and departmental activities on an annual basis.  It is very important that colleges and departments report unrelated business activities to the Auxiliary/EBA Office so that these may be reported to the IRS on the University’s Form 990-T.

While the activity may not be subject to the Unrelated Business Income Tax for the reporting period, it must be continue to be evaluated. If the business model or activities change significantly or if you engage in new activities that have not already been reviewed, please notify Auxiliary/EBA office.

The Internal Revenue Service can and will assess costly penalties and interest charges for underpayment of taxes.  The department/college will bear the cost of penalties.

UBI Questionnaire and Certification

For more information view the UBI Questionnaire and Certification page.

Last Reviewed

05/01/2020: reviewed content

Contacts

Educational Business Activity/Auxiliary Accounting: (352) 294-7236