Non profit law question: Can you help me on this ?

[gillian59]

Art Museum is a California nonprofit public benefit corporation with IRC Section
501(c)(3) tax-exempt status. It’s function is to educate the public by displaying works of
art for public appreciation. Art Museum would like to enter into a partnership agreement
with a for-profit art gallery to display works of local artists and then sell the works
through the gallery. Art Museum and the art gallery would share in a 50 percent
commission on sales. Explain how the partnership could jeopardize the tax-exempt status
of the museum. Also discuss whether the income from sale of the art would be subject to
the unrelated business income taxation.

[bernd]

The gallery could not profit from the sale of the product because then the non-profit would be involved in for-profit activity and could lose it's 501C3 status, and all income would be subject to tax.