Nonmember Income and 501(c)(7) Social Clubs

Social clubs may be exempt from federal income taxation if they meet the requirements of Section 501(c)(7) of the Code.   Although social clubs are generally exempt from tax, theyare subject to tax on their unrelated business income which generally includes all income from non-members.   In addition, a social club may lose its exempt status if it receives too much unrelated income.  The IRS has released a new chart and other new web content on tax issues of social clubs. Social clubs may click here to review this material and confirm how nonmember/nontraditional income may affect the tax-exempt status of a social club under Section 501(c)(7).

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