Phyllis gene is a certified human resource manager who serves on the board of a local professional association of human resource managers. The association puts on an annual conference for its members at which there are educational workshops and keynote speakers. For the first time the board is considering setting up an exhibit space for vendors. The board believes that the sale of exhibit space to vendors could result in substantial revenues, which could be used to support the associations mission. A concern of Ms. Genes is whether the revenues generated would be subject to unrelated business income tax. As a result, Gene has asked your assistance as an accounting student in helping determine any tax implications related to the proposal.

A) Create a list of questions to pose to the executive director of the association about the proposed advertising so that the board has all the relevant facts on hand.

B) What resources are available to investigate whether income from advertising is subject to unrelated business income tax?

C) Prepare a memo to Ms. Gene that outlines the key issues and suggest an approach to minimize any tax effects.