Tax-exempt organizations can owe unrelated business income tax, or UBIT, on income from activities that are a trade or business, regularly carried on, and not substantially related to their exempt purpose. For associations, advertising sales and certain affinity programs are common areas to review. Taxable income is reported on Form 990-T.
The rules include many exclusions and modifications, so organizations should review new revenue streams with their accountant before launching them. Tracking revenue by program and source makes that review much easier.