•b) Accumulating Excess Income
–IT-296R indicates that an NPO may earn income in excess of its expenditures and that the excess may result from the activity for which it was organized or from some other activity
–A one-time capital gain from disposing of
property does not jeopardize NPO’s status
(Document 2010-035802)
–But, if a material part of an excess is accumulated each year and the balance of accumulated excess at any time is greater than the NPO’s reasonable needs to carry on its non-profit activities the NPO will be considered to be operating for a profit