Which non-profit organizations quality for an exemption?

A "nonprofit organization" is defined by U.S.C. 59-2-1101(1)(g)(i) in the following way.                                         

  • that is organized on a nonprofit basis, that dedicates the entity's property to the entity's nonprofit purpose, and that makes no dividend or other form of financial                                                 benefit available to a private interest;                                           
  • for which, upon dissolution, the entity's assets are distributable only for exempt purposes under state law or to the government for a public purpose;                                            
  • that does not receive income from any source, including gifts, donations, or payments from recipients of products or services, that produces a profit to the entity in the sense that the income exceeds operating and long-term maintenance expenses; and                                          
  • for which none of the net earnings or donations made to the entity inure to the benefit of private shareholders or other individuals, as the private inurement standard                                                 has been interpreted under Section 501(c)(3), Internal Revenue Code.

"Nonprofit organization" also includes the following as defined by U.S.C. 59-2-1101(1)(g)(ii).                                         

  • An organization that is treated as a disregarded entity for federal income tax purposes and wholly owned by, and controlled under the direction of, a nonprofit entity;                                                 AND                                          
  • Which none of the net earnings and profits of the entity inure to the benefit of any person other than a nonprofit entity.

    In addition, a nonprofit organization must meet one of the three criteria listed below.                                       
  • "Charitable purpose" defined as:                                    
    • Property used as a nonprofit hospital or a nursing home, the standards outlined in Howell v. County Board of Cache County ex rel. IHC Hospitals, Inc., 881 P.2d 880 (Utah 1994); AND                                        
    • Property other than property described in Subsection (1)(a)(i), providing a gift to the community.                               
  • "Educational purposes" means purposes carried on by an educational organization that normally:                                    
    • Maintaining a regular faculty and curriculum; AND                                        
    • Has a regularly enrolled body of pupils and students.
    "Educational purposes" also includes:                                    
    • the physical or mental teaching, training, or conditioning of competitive athletes by a national governing body of sport recognized by the United States Olympic Committee that qualifies as being tax exempt under Section 501(c)(3), Internal Revenue Code; AND                                       
    • an activity in support of or incidental to the teaching, training, or conditioning described above.                               
  • Religious organization defined as:                                    
    • Any organization that has a religious exemption under IRS 501(c)(3) guidelines.

Show All Answers

1. Which non-profit organizations quality for an exemption?
2. Is all property owned by a non-profit organization eligible to be exempted?
3. When can an organization apply for a new exemption on a property?
4. Does an organization need to reapply each year?
5. Can vacant land receive an exemption?