Does your unit perform ordinary or routine testing services for customers external to the university? If so, did you know there may be unrelated business income tax (UBIT) implications from providing these services?
Per IRS guidelines, ordinary or routine testing services have the following characteristics:
- A standard procedure is used to perform the testing (i.e., not scientific research);
- No intellectual questions are posed;
- Other entities within reasonable proximity also provide the same type of testing services;
- The work is routine and/or repetitive in nature; and
- No research activities or analyses which serve a public interest are performed by the University of Illinois System as a part of the testing activities.
If your ordinary or routine testing services meet these criteria or if further clarification is needed to make a determination, then contact UAFR and Tax, Compliance, and Analysis (TCA). In addition, refer to Section 18.13, Unrelated Business Income Tax (UBIT) within the Business and Financial Policies and Procedures Manual which addresses this topic as well.
Contact
For further details, contact UAFR's applicable subject matter experts within the Unrelated Business Income Tax (UBIT) section of UAFR's Who to Ask list.
