The church files Form 990-T for rental income. They have sold the church in an installment sale. Is the tax treatment of the sale the same as any other installment sale and sale of business property? Or is there some rule or regulation I can't seem to find that states otherwise?
Are you sure the sale is UBIT?
No, I am not at all certain that the sale would be UBIT. In fact, I don't believe it is. So, here is further breakdown. This is a new client, so we really don't know their history as well as we'd like.
Client stated that they have UBIT for rental income for a building. However, they sold the church building they owned approximately 3 years ago for a very subtantial amount and received payment in 2008 (they are currently paying rent until they find a new building that meets their needs). One of our main concerns would be the reporting of interest which is in the $100,000 - $150,000 range.
At this point, I am not even certain that the sale is taxable. During research, I at first thought Sale of Business property, however other discussions have resulted in my questioning the reasonableness of that.
Any thoughts or ideas would be greatly welcome.
The more I have researched, the more I have come up empty (plus I now have more facts). I am at the point where I have decided that since I can't find anything on this particular issue, there probably isn't a requirement. If they weren't required to file the 990-T, they would have no filing requirement. Is this correct?
