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Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 2688
Experience:  18+ years of experience in tax preparation; 25+ years of experience as a real estate/corporate paralegal.
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We are a non-profit women's club of a country club in California

Customer Question

We are a non-profit women's club of a country club in California who participates in community outreach/contributions. Recently we have invited vendors to sell their wares on the premises during our luncheons. Furthermore, these vendors are encouraged to donate 10% of their sales to our contribution endeavors. I am curious as to whether we are in a tax issue, are we are actually in a profit position ($1200/year) and do we need a Tax ID if they claim their contribution as a tax write off. I would welcome guidelines on this as Treasurer of this organization.
Submitted: 5 months ago.
Category: Tax
Expert:  Mark Anderson replied 5 months ago.
It depends if it is unrelated income:
Expert:  Mark Anderson replied 5 months ago.
Here is some info on social clubs:
Expert:  Barbara replied 5 months ago.
Different expert here - my name is ***** ***** please allow me to specifically answer your questions.Member income funds social clubs. This can be in the form of membership fees, dues, or assessments.However, 501(c)(7) organization may receive up to 35 percent of its gross receipts, including investment income, from sources outside of its membership without losing its tax-exempt status. No more than 15 percent of the amount may be derived from use of the club’s facilities or services by the general public or from other activities not furthering social or recreational purposes for members.Donations to exempt social and recreation clubs are NOT deductible as charitable contributions on the donor's federal income tax return.The following links contain excellent information you will find helpful: let me know if you require further information or clarification.Thank you and best regards,Barb
Expert:  Barbara replied 5 months ago.
Just following up with you to see if you have any other questions or concerns. If so, please come back to me here, and I will be happy to assist you further.Best regards,Barb

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