[Code of Federal Regulations]
[Title 26, Volume 12]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.1502-100]

[Page 542-543]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.1502-100  Corporations exempt from tax.

    (a) In general--(1) Computation of tax liability. The tax liability 
for a consolidated return year of a group of two or

[[Page 543]]

more corporations described in section 1504(e) which are exempt from 
taxation under section 501 (hereinafter referred to in this section as 
``exempt group'') shall be determined on a consolidated basis by 
applying the provisions of subchapter F of chapter 1 of the code in the 
manner provided in this section. See section 1504(e) for tax-exempt 
corporations eligible to file a consolidated return.
    (2) Applicability of other consolidated return provisions. The 
provisions of Sec. 1.1502-1 through Sec. 1.1502-80 shall be applicable 
to an exempt group to the extent they are not inconsistent with the 
provisions of this section or the provisions of subchapter F of chapter 
1 of the Code. For purposes of applying the provisions of Sec. 1.1502-1 
through Sec. 1.1502-80 to an exempt group, the following substitutions 
shall be made:
    (i) The term ``exempt group'' shall be substituted for the term 
``group'',
    (ii) The terms ``unrelated business taxable income'', ``separate 
unrelated business taxable income'', and ``consolidated unrelated 
business taxable income'' shall be substituted for the terms ``taxable 
income'', ``separate taxable income'', and ``consolidated taxable 
income'', and
    (iii) The term ``consolidated liability for tax determined under 
Sec. 1.1502-2'' (or an equivalent term) shall mean the consolidated 
liability for tax of an exempt group determined under paragraph (b) of 
this section.
    (b) Consolidated liability for tax. The tax liability for a 
consolidated return year of an exempt group is the tax imposed by 
section 511(a) or section 1201(a) on the consolidated unrelated business 
taxable income for the year (determined under paragraph (c) of this 
section), and by allowing the credits and surtax exemption provided in 
Sec. 1.1502-2.
    (c) Consolidated unrelated business taxable income. The consolidated 
unrelated business taxable income for a consolidated return year shall 
be determined by taking into account:
    (1) The separate unrelated business taxable income of each member of 
the exempt group (determined under paragraph (d) of this section);
    (2) Any consolidated net operating loss deduction (determined under 
Sec. 1.1502-21A or 1.1502-21 (as appropriate) subject to the 
limitations provided in section 512(b)(6);
    (3) Any consolidated charitable contribution deduction (determined 
under Sec. 1.1502-24) subject to the limitations provided in section 
512(b)(10); and
    (4) Any consolidated net gain or net loss from the disposition of 
debt-financed property (as defined in section 514(b)) taken into account 
as provided by section 514(a), or from the cutting of timber to which 
section 631 applies.
    (d) Separate unrelated business taxable income. The separate 
unrelated business taxable income of a member of an exempt group shall 
be computed in accordance with the provisions of section 512 covering 
the determination of unrelated business taxable income of separate 
corporations, except that:
    (1) The provisions of paragraphs (a) through (k) and (o) of Sec. 
1.1502-12 shall apply; and
    (2) No charitable contributions deduction shall be taken into 
account under section 512(b)(10).

See sections 511(c) and 512(a)(3)(C) for special rules applicable to 
organizations described in section 501(c)(2).

[T.D. 7595, 44 FR 10382, Feb. 20, 1979, as amended by T.D. 8677, 61 FR 
33325, June 27, 1996; T.D. 8823, 64 FR 36101, July 2, 1999]