Are distributions paid or distributions credited to shareholders, partners, or members who are exempt organizations subject to withholding?
• Only if the distributions paid or distributions credited result in unrelated business taxable income to the exempt organization. Any distribution paid or credited to an exempt organization that is not related to the purpose for which the organization received exempt status is taxable as unrelated business taxable income under Georgia Code Section 48-7-25(c)(1). Thus, any distribution paid or distribution credited which results in unrelated business taxable income to an exempt organization as defined by IRC Section 512 will be subject to withholding. Distributions paid or distributions credited to an exempt organization that do not result in unrelated business taxable income are not subject to withholding.
Related Questions
- Are distributions paid or distributions credited to shareholders, partners, or members who are insurance companies subject to withholding under Georgia Code Section 48-7-129?
- Are distributions paid or distributions credited to shareholders, partners, or members who are exempt organizations subject to withholding?
- When are the partners, shareholders or members responsible for paying their own tax instead of being subject to withholding?
