American Exceptionalism: Private Capital as the Decisive Competitive Advantage
[This post is the second in a series on American Exceptionalism. I’ve written on this subject elsewhere, so some of you may want to skip this one.]
[This post is the second in a series on American Exceptionalism. I’ve written on this subject elsewhere, so some of you may want to skip this one.]
[This post is the first in a series on American Exceptionalism. I’ve written on this subject elsewhere, so some of you may want to skip this one.]
You might suppose that an IRS that was death on so-called “jeopardizing investments” (see my post of 3/20/13) would work itself into a positive frenzy over a foundation that invested all its assets in one security. Talk about jeopardy!
UBI stands for “unrelated business income,” a concept unknown to the natural world but one that has infected the Internal Revenue Code (§ 513) for a long time. (UBIT stands for unrelated business income tax.) Basically, § 513 means that nonprofit organizations (operating nonprofits, foundations, endowments, IRAs) can’t engage in business operations or they will have to pay taxes on any revenues they generate. If they engage in too much business activity, they can lose their exempt status. An obvious example would be many of the items sold in museum gift shops.