Even though an organization may be recognized as tax exempt, it still may be liable for tax on its unrelated business income. For most organizations, unrelated business income is income from a trade or business, regularly carried on, that is not substantially related to the charitable, educational, or other purpose that is the basis of the organization's exemption.
(If you didn't understand what that meant above, it means things like t-shirt sales, coffee mugs, bulk rate insurance royalties, recurring advertising sales (not one time ads for your annual event), things that don't really have to do with your tax exempt purpose.)
An exempt organization that has $1,000 or more of gross income from unrelated business activities must file Form 990-T. An organization must pay estimated tax if it expects its tax for the year to be $500 or more. A word of caution: if your nonprofit earns more than 20% of its income from unrelated business activities it could potentially lose tax-exempt status.
The obligation to file Form 990-T is in addition to the obligation to file the annual information return, Form 990, 990-EZ or 990-PF. Each organization must file a separate Form 990-T, except title holding corporations and organizations receiving their earnings that file a consolidated return under Internal Revenue Code section 1501.