Next-generation sequencing greatly increases the capacity to detect rare-variant complex-trait associations. However, it is still expensive to sequence a large number of samples and therefore often small datasets are used. Given cost constraints, a potentially more powerful two-step strategy is to sequence a subset of the sample to discover variants, and genotype the identified variants in the remaining sample. If only cases are sequenced, directly combining sequence and genotype data will lead to inflated type-I errors in rare-variant association analysis. Although several methods have been developed to correct for the bias, they are either underpowered or theoretically invalid. We proposed a new method SEQCHIP to integrate genotype and sequence data, which can be used with most existing rare-variant tests.