Action needed: FY 2026 Unrelated Business Income Tax (UBIT) due Aug. 31

If your department has undisclosed unrelated business income (UBI), we need your fiscal year 2026 UBI and associated expenses by Monday, Aug. 31.

The Tax Services team has begun preparing for the university’s FY 2026 unrelated business income tax (UBIT) filing, and your help is needed to file accurately and on time.

If Tax Services previously notified you of a Sept. 4 deadline, please continue to follow that guidance. The Aug. 31 deadline applies to departments that may have UBI and allows Tax Services time to determine whether the activity is subject to UBIT.

What is UBIT?

As an integral part of the State of Arizona, the University of Arizona is exempt from federal income tax when revenue is generated from activities that are substantially related to university exempt purposes, which include research and discovery, teaching and learning, and outreach and public service.

However, revenue-generating activity may be subject to UBIT if all three conditions are met:

  • Activity is operated like a trade or business 
  • Activity is regularly carried on  
  • Activity is substantially unrelated to university exempt purposes

Tax Services will review the facts and circumstances of an activity and help you determine whether UBIT applies. 

Review UBIT information and resources

What to do by Aug. 31 

If your department has undisclosed UBI activity: 

  • Submit your FY 2026 UBI and associated expenses to Tax Services by Monday, Aug. 31.

If you are not sure whether your department’s activities may have UBI impact:

Why this matters 

Per IRS Publication 598, UBIT returns are subject to the same assessment and correction penalties as other tax filings. If an activity is retroactively found to be subject to UBIT, your department will be responsible for providing funds to cover the corresponding tax liability and any applicable interest and penalties.

Thank you for your continued collaboration in keeping the university tax compliant.