Do clubs in the Villages have to pay Tax?

[PersonOfInterest]

It seems like some of the clubs that collect dues file tax returns and others seem to ignore it. Does it depend on how much dues are collected or how many members? Are Clubs protected under the Villages umbrella?

[Gpsma]

Im the Treasurer of one of the biggest clubs in the Villages. The club is a corporation. We file federal income tax.

Im sure how we operate is similar to other larger clubs that may have significant income from dues and other sources. Smaller clubs that arent corporations and collect modest dues to pay for misc supplies probably dont have the income to require a tax return

[Papa_lecki]

The threshold level for a 990 tax return is $200,000 in gross receipts or $500,000 in assets.
Some do, some don’t.

[ton80]

It seems like some of the clubs that collect dues file tax returns and others seem to ignore it. Does it depend on how much dues are collected or how many members? Are Clubs protected under the Villages umbrella?

I am not a lawyer nor a CPA, but I have researched the topic for our club and have discussed our situation directly with the IRS.:
1. My research indicates that to achieve Tax Exempt status for your Club you have to meet IRS criteria and apply to IRS to get their formal agreement that you qualify for Tax Exempt status. With this notice of tax exempt status you do not have to file a an income tax form nor pay any federal income tax. However you have to file an IRS Information Form annually to maintain your tax exempt status. For small clubs with income less than ~50,000 $, the form is Form 990N and is called the electronic postcard which must be filed electronically. There are many IRS documents explaining the conditions and procedures. Social Club expenses can not be used as income tax deductions.

2. Your organization can be a 501 (c) (3) charitable and educational organization and expenses may be deductible by the members IF the Club meets all of the required criteria. There are very few Clubs in TV that are registered as 501 (c) (3) based on my search of the public IRS Non profit lists. The Opera Club which gives performances to raise money for music scholarships and awards them is a notable exception. They are truly a charitable organization.

3. Our Club is a recognized by the IRS as a Tax Exempt Social Club 501 (c) (7) . We meet all of the criteria:
a. Organized for a common interest
b. Our income is essentially all from our members
c. Our expenses are for our members.
d. etc.
e. This is typical of majority of clubs in TV IMHO.

We file the 990 N electronic postcard information for to the IRS before the 15th of the fifth month following the end of our fiscal year. By doing this our Bank Account Tax Number (EIN) is registered with the IRS and we continue to be recognized as Tax Exempt.

I do not believe that any Club is protected by any "Villages umbrella" since there are no Tax Exempt Villages Organizations available for Clubs.. Some 501 (c) (3) Clubs such as Trout Unlimited Chapters operate under TL umbrella but need to pay dues to the Main TL Organization and file business plans with TL Headquarters to be covered under the TL Tax Exempt Umbrella.

Hope this helps.

[PersonOfInterest]

All of that information is useful. Thank you.