501(c)(7) Tax-Exempt Social Club Organizations: Mastering Tax and Operational Requirements
Reporting Nonmember and Nontraditional Income, Keeping Within Safe Harbor, and Defending IRS Exemption Challenges
Recording of a 110-minute CPE webinar with Q&A
This course will give a detailed overview of the accounting and operational requirements of an IRC 501(c)(7) “social club” organization. The panel will offer concrete illustrations of “non-member” and “nontraditional income,” review the safe harbors for unrelated income, and provide guidance on responding to IRS challenges to exempt status.
Outline
- Organizing principles of IRC 501(c)(7);
- Transactions and events that can trigger UBTI or loss of exempt status (including excess non-member income, advertising for non-member use of facilities, nontraditional income, reciprocal income).
- Use of subsidiaries;
- How to defend a challenge to exempt status; and
- Certain tax differences between tax-exempt clubs and taxable clubs (diverse treatment of capital assessments and initiation fees and insurance proceeds)
Benefits
The panel will discuss these and other important issues:
- What are the nonmember and non-related income definitions and thresholds for IRC 501(c)(7) organizations?
- How does UBTI and other non-member income impact the exempt status of a social club?
- What documentation is essential for defending against an IRS challenge to tax exempt status?
- Certain tax differences between tax-exempt clubs and taxable clubs.
Faculty
James J. Reilly
Partner
Condon O'Meara McGinty & Donnelly
Mr. Reilly practices in the area of not-for-profit organizations, including foundations, religious organizations,... | Read More
Mr. Reilly practices in the area of not-for-profit organizations, including foundations, religious organizations, public charities, membership organizations, social clubs, high net worth individuals and their trusts and privately held companies. He is an author and speaker with respect to nonprofit organizations on subjects including tax law issues relating to family and company foundations, charitable organizations, membership organizations, business leagues and social welfare organizations tax law issues, as well as IRS examinations of not-for-profit organizations. He is the author of The Little Club Book and the editor of the National Club Association’s The Federal Tax Treatment of Private Clubs.
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James W. Gilson, CPA
Partner
Condon O'Meara McGinty & Donnelly
Mr. Gilson is a member of the American Institute of Certified Public Accountants (AICPA), the AICAP Not-for-Profit... | Read More
Mr. Gilson is a member of the American Institute of Certified Public Accountants (AICPA), the AICAP Not-for-Profit Section, the New York State Society of Certified Public Accountants (NYSSCPA), the New Jersey Society of Certified Public Accountants (NJSCPA), and the Hospitality Financial and Technology Professionals Association (HFTP). He has over 20 years of experience in the private club field. His prime responsibilities and areas of practice include accounting, auditing, and internal control review. He has presented seminars on club operations to club managers and club controllers. He is a past presenter at the Hospitality Financial and Technology Professionals (HFTP) Annual Convention and HFTP's HITEC. He is also responsible for preparing the firm's annual statistical publication on club operations (Club Operating and Management Data).
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