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does not prevent the mailer's list rental payment from being a
royalty.
Section 513(h)
Finally, respondent argues that the enactment of section
513(h) precludes a conclusion that the list rental payment is a
royalty. The relevant parts of section 513(h) provide:
SEC. 513(h). Certain Distributions of Low Cost
Articles Without Obligation to Purchase and Exchanges
and Rentals of Member Lists.--
(1) In general.--In case of an
organization which is described in section
501 and contributions to which are deductible
under paragraph (2) or (3) of section 170(c),
the term "unrelated trade or business" does
not include--
* * * * * * *
(B) any trade or business
which consists of--
(i) exchanging with
another such organization
names and addresses of donors
to (or members of) such
organization, or
(ii) renting such names
and addresses to another such
organization.
Section 513(h) provides a safe harbor for the rental and exchange
of mailing lists between certain charities. Section 513(h) was
enacted during 1986, after the decision of the Court of Claims in
DAV I. Respondent argues that, in enacting section 513(h) and
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