Question

What does it mean that, under federal law, a tax-exempt organization's net earnings may not "inure" to the benefit of any private individual?

Answer 1

Under federal law, a tax-exempt organization's net earnings may not "inure" to the benefit of any private individual. Instead, the earnings must be used for the organization's exempt purpose.

Step-by-step explanation:

Under federal law, a tax-exempt organization's net earnings may not "inure" to the benefit of any private individual. This means that the organization's profits cannot be used to benefit individuals who are involved with or connected to the organization. Instead, the earnings must be used for the organization's exempt purpose, such as charitable, educational, or religious activities.