Engaging in a Prohibited Transaction Can Result in an Exempt

question 6

True/False

Engaging in a prohibited transaction can result in an exempt organization being subject to Federal income tax, but cannot cause it to lose its exempt status unless the exempt organization repeats the prohibited transaction.

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Definitions:

Absorption

The process by which substances are taken up from the environment and enter the bloodstream or tissues.

Secretion

The process by which substances are produced and discharged from cells or glands for a particular function in the organism.

Epithelial

Pertaining to the epithelium, the layer of cells covering internal and external surfaces of the body, including skin, glands, and digestive tract lining.

Electrical Impulses

Signals transmitted by neurons and other cells to communicate information within the body.