To Maintain Exempt Status, an Organization Must Do Which of the Following

question 82

Multiple Choice

To maintain exempt status, an organization must do which of the following:

• A)Satisfy only an organizational test.
• B)Satisfy only an operational test.
• C)Satisfy both an organizational test and an operational test.
• D)Satisfy a financial test.
• E)Once exempt status is granted, it will continue regardless of whether the organizational test and the operational test are satisfied.

---

Definitions:

Privity of Contract

The principle that a contract confers rights and imposes liabilities only on its parties; no outsider can gain rights or be liable under it.

Novation

The process of replacing an existing obligation with a new one, substituting a party or terms in a contract with the consent of all parties involved.

Rules of Interpretation

Guidelines and principles used to determine the meaning and intention of legal texts and statutory provisions.

Doctrine of Privity

A principle in contract law stating that contracts are binding only upon the parties signing the contract and no third party can enforce or be bound by the contract.