The University of Texas at Dallas is recognized by the Internal Revenue Service (IRS) as an organization exempt from federal taxation, however the IRS imposes a tax on exempt organizations on activities that are unrelated to its exempt purposes.
This tax is known as the unrelated business income tax (UBIT), and is generated from activities that meet all three characteristics: 1) occur on a regular basis, 2) are unrelated to the University’s educational or research activities, and 3) operate with the intention of generating a profit.
There are three tests to determine if income may be subject to unrelated business income tax (UBIT), and all three tests must be met:
Possible UBIT generating activities include selling goods and services unrelated to UTD’s exempt purposes, alumni and general public use of facilities, advertising, and testing or commercial activities on behalf of a private company.
There are exceptions to UBIT tax, which include the following: activities conducted by volunteers, activities that are for the convenience of UTD students and staff, investment income, rental of real property, royalty income and scientific research.
A UTD Nonfinancial Questionnaire (NFQ) 
should be completed for any activity that may possibly generate unrelated business income tax (UBIT), per UT System policy UTS 103 Unrelated Business Income Tax (UBIT). Completed questionnaires should be sent to taxcompliance@utdallas.edu.
Contact the Tax Compliance Office at taxcompliance@utdallas.edu for any questions regarding unrelated business income tax (UBIT).
