Does your nonprofit add to its income with sponsorships or advertising programs? Any payments received may be subject to unrelated business income tax unless the activities are substantially related to your tax-exempt purpose or qualify for another exemption. Qualified sponsorship payments are made with no arrangement to receive, or expectation of receiving, any substantial benefit in return, and aren’t taxed. But payments for advertising a sponsor’s products or services are considered unrelated business income and subject to tax. Contact us if you have questions.
