Expanded Coverage for High-Risk Medical Care Pools

Beginning in 1998, a tax-exempt, state-sponsored organization that was established to provide medical care coverage to high-risk individuals may also cover spouses and certain dependent children of high-risk individuals. For more information, see Publication 557, Tax-Exempt Status for Your Organization.

Qualified Sponsorship Activities

Generally, an exempt organization that regularly carries on a trade or business not substantially related to its exempt purpose is subject to tax on its income from the unrelated trade or business. Beginning in 1998, soliciting and receiving qualified sponsorship payments is not an unrelated trade or business and the payments are not subject to unrelated business income tax.

Qualified sponsorship payment. This is any payment made by a person engaged in a trade or business for which the person will receive no substantial benefit other than the use or acknowledgment of the business name, logo, or product lines in connection with the organization's activities. For more information, see Publication 598, Tax on Unrelated Business Income of Exempt Organizations.

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