error-file:tidyout.log

error-file:tidyout.log

CLUB TAX BOOK

"An Accumulation Of Tax And Legal Issues Specific To Clubs"

TABLE OF CONTENTS

Updated DECEMBER 2009


CHAPTER 1: Law Applicable To Clubs

Internal Revenue Code Section 118
Internal Revenue Code Section 277
Internal Revenue Regulation 1.277-1 Obsolete
Internal Revenue Regulation 1.337(d)-4
Internal Revenue Code Section 456
Internal Revenue Code Section 501(c)(7)
Internal Revenue Regulation 1.501(c)(7)-1
Internal Revenue Code Section 511
Internal Revenue Code Section 512

CHAPTER 2: Club Tax Issues

A

Abandoned Property; Escheats Law
Advertising; 501(c)(7) Status Revoked
Advertising; Events Open To General Public
Advertising; For New Members
Advertising; Internet Search Engines
Advertising; The Real Question Is The Privacy Issue
Advertising: To Non-Members
Advertising Expenses
Advertising Expenses; Readership Expenses
Advertising Income; Magazines And Newsletters
Allowances; Accountable Vs Non-Accountable Plan
Alternative Minimum Tax; 277 Club
Alternative Minimum Tax; 501(c)(7) Club & FICA Tips
Alternative Minimum Tax; Small Corporations Exempt
Artwork; Sale Of Valuable Painting
Assessments; 277 Club
Automobiles; Club Policies
Awards; Exceptional Productivity
Awards; Length-Of-Service
Awards; Safety Achievement

 

B

Barter Transactions
Barter Transactions: Ranger Services For Golf Privileges
Building Lots; Use In Club Operations

C

Caddies; Employment Classification Issues
Caddies; Payroll Taxes
Caddies; Worker's Compensation
Capital Assessment; 277 Club
Capital Assessment; 277 Club; Failure To Designate
Capital Assessment; 277 Club; Investment Motive Required?
Capital Assessment; 277 Club; New Member Investment Motive      Required?
Capital Assessment; Replacement Reserves
Casualty Loss Restoration; Capital Expenditures
Catering; Nontraditional Income
Catering; Off Premises
Change Year End
Charitable Set Aside; Fund Raiser
Charitable Set Aside; Interest Income
Charitable Set Aside; Reduces Taxable Income
Charity; Clubhouse Facade
Charity; Lease Of Equipment For Golf Course
Charity; Restoring Club's Historic Building
Charity Balls
Charity; Certificates; Quid Pro Quo Disclosures
Charity; Certificates; Tax Deductions
Charity Golf/Tennis Tournament
Charity Golf Tournament; Who Pays?
Club Related Associations & Newsletters
Corporate Checks; 501(c)(7)
Corporate Checks; Bad Facts = Nonmember Income
Corporate Checks For Dues; Tax Free Fringe Benefit
Corporate Contribution To 501(c)(7) Club
Corporate Members; 277 Taxable Clubs
Corporate Members; 501(c)(7)
Corporate Members; Living Trust
Corporate Members; LLC's; Single Member
Corporate Sponsored Members
Credit Cards; Surcharge Added
Credit Cards; Used For Dues

D

Debt Cancellation; Deadbeats
Deferred Compensation; 457(b) & 401(k)
Deferred Compensation; 457(b) & 457(f)
Deferred Compensation; 457(b) & 457(f) Differences
Deferred Compensation; 457(b) Limits On Contributions
Deferred Compensation; 457(f) Applied To 501(c)(7)'s
Deferred Compensation; 457(f) & 401(k)
Deferred Compensation; Filings Required
Deferred Compensation; F/S Disclosure
Deferred Compensation; Investment Gains
Deferred Compensation; Investment Income
Deferred Compensation; Rabbi Trust
Deferred Compensation; Transfers
Deferred Compensation; W-2 Reporting
Depreciation; 15 Year Improvements
Depreciation; A M T Life Election
Depreciation; Allowed or Allowable For Former 501(c)(7)
Depreciation; Bunkers
Depreciation; Cost Segregation
Depreciation; Cost Segregation Study
Depreciation; Fairways
Depreciation; Golf Course Improvements
Depreciation; Golf Course Items Expected Life Cycle
Depreciation; Greens; Modern
Depreciation; Greens; "Push-up"
Depreciation; Greens & Tees
Depreciation; Greens & Tees; Design Fees
Depreciation; Lives
Depreciation: Marina's
Depreciation; Redesigning Course
Depreciation; Restaurant Equipment
Depreciation; Roughs
Depreciation; Smallwares; China, Glassware, Etc.; Start-up Vs. Replacements
Depreciation; Underground Watering System
Developer; Cost Allocations
Developer; Cost Allocations; No Retention Of Ownership Rights
Developer; Cost Allocations; Retention Of Ownership Rights
Developer; Funding Cash Operating Defecit Spending
Developer Donates Club To Charity
Developer Settlement Proceeds
Developer Settlement Proceeds; Construction Defects
Disability; Disabled Access Tax Credit
Disclosure Requirements; Form 990
Disclosure Requirements; Form 990; Executive Compensation
Disclosure Requirements; Form 990; Five Highest
Disclosure Requirements; Form 990; Managers Compensation
Discounts To Club Stockholders; Taxable Dividends Discrimination
Disposition; Building Lots
Disposition; Concepts Illustrated
Disposition; Diminished Use
Disposition; Easement
Disposition; Final Sale In Dissolving 501(c)(7) Club
Disposition; Homesites
Disposition; Land Not Used For Club Purposes
Disposition; Land Not Used Properly After Purchase
Disposition; Leasehold Property
Disposition; Like-Kind Exchanges
Disposition; Option Granted
Disposition; Painting
Disposition; Prior Debt Payoff Not Reinvestment
Disposition; Prior Debt Qualified Reinvestment If Timely
Disposition; Statement
Disposition; Subdividing Land To Sell
Disposition; Time To Replace
Disposition; Type Of Property For Replacement
Disposition; Used For Employees; Sod Farm & Buffer Zone
Disposition; View
Disposition; Water Basin
Disposition; What Not To Do
Dividend Received Deduction
Dues Billings; Disclosure
Dues Billings; Memo Billing
Dues Collected By POA

E

Educational Scholarship Foundation; Club Employees
Employee Leasing; 457 Plans
Equity Club; Defined
Equity Club; Refundable Or Non Refundable
Exempt Status; 337 Gain Avoided
Exempt Status; Administer & Enforce Covenants
Exempt Status; Copy of 501(c)(7) Application Request
Exempt Status; Developer Controlled
Exempt Status; Fire, Security & Trash Collection
Exempt Status; Loss of Exemption Due to Activities
Exempt Status; Maintaining Residential Streets
Exempt Status; Self Termination
Exempt Status; Terminating Or Merging
Exempt Status; Voluntary Surrender - Reorganization
Exempt Status; What To Consider
Exempt Status; When To Be Exempt?
Exempt Status; Why Revoked
Expense Allocation; Acceptable Methods
Expense Allocation; Golf Rounds
Expense Allocation; Gross To Gross
Expense Allocation; IRS Method Based Upon 24 Hrs.
Expense Allocation; Section 277 Club
Expense Allowances
Extending Returns; 990 & 990T

F

Fee; Bringing In New Member
FICA Tip Credit
FICA Tip Credit; Unreported Tips
FIN 48; Delayed
Foreign Employees; H-2B Temporary Work Visa Program
Foreign Member; Reduced Withholding
Foreign Member; Withholding Required
Form 990; $50,000 Penalty For Failure To File
Form 990; Application Pending For 501(c)(7) Status
Form 990; Conflict of Interest Policy
Form 990; Draft of New Return 10/29/08
Form 990; Penalty Regime Revision Coming
Form 990; Publicly Disclosed on www.GuideStar.org
Form 990; Sample
Form 990-T; Fuel Tax Credit Addback
Form 990-T; Negative Deduction; Nonmember Loss Limitations
Form 1099-B
Form 1099-Misc.
Form 1099-Misc.; Avoid Private Inurement
Form 1099-Misc.; Golf Tournament Prizes
Form W-9; Request For Identification Number
Founder Member; Contribution Deemed Capital
Founder Member; Free Dues; Inurement & 501(c)(7)
Free Dues; Free Golf; Free Anything; Taxable
Free Membership; Retired Employee
Fringe Benefit; Cell Phones
Fringe Benefit; Dependent Care
Fringe Benefit; Use Of Club Facilities
Fuel Tax Credit
Fuel Tax Credit; Clear Diesel

G

Gaming
Gaming; Bingo Proceeds To Charity
Gaming; IRS Examination Guidelines
Gaming; Response To IRS Audit Checklist
Gaming; W-2G Requirements
Gasoline Sales To Members
General Public; Open To
Gift Cards
Gift Certificates; Escheat Laws
Gifts Of Membership To Club
Gifts To Club; $12,000 Exempt
Gifts To Club; Club Deemed A Single Entity
Gifts To Club; Deemed Gifts To Members
Gifts To Club; IRS Guidance Confusinig
Gifts To Club; Natural Disaster Relief
Golf And Tennis Pros; Employees Of Clubs
Golf Association; Men's And Women's
Golf Car; Disabled Access Credit
Golf Car; Electric Vehicle Credit
Golf Facilities; 501(c)(3)'s
Golf Facilities; 501(c)(3)'s; Golf As A Life Skill
Golf Pro; Contractor Vs Employee
Golf Pro; Golf Shop
Golf Pro; Golf Shop; Contrary Position
Golf Pro; Independent Contractor
Grants; Disaster Relief Funds For Employees
Greens; Maintenance
Guest; Unaccompanied; Member Income
Guest Cards; UBIT
GuideStar.org

H

Holiday Fund
Holiday Fund; Federal Withholding
Home Owner; Automatic Membership
Honorary Member; Free Dues
Housing; Convenience Of Employer

I

Independent Contractor; Employee Status
Independent Contractor; IRS Changes Position
Independent Contractor; Section 530 Relief
InitiationFee; Amortization; AICPA Guidance
Initiation Fee; Amortization; SEC Guidance
Initiation Fee; IRS Guidance
Installment Options; Member's Investment Interest Expense
Installment Options To Join
Insurance; Stock Received From Demutualization
Interest Charge Loans From Members
Interest Free Loans
Interest Free Loans; Non-Equity Members
Interest Income; 277 Clubs
Interest Income; Capital Improvement Account
Interest Income; Excess Amount Determined
Interest Income; Installment Payments
Interest Income; Municipal Bond Interest
Interest Income; Offsetting Deductions
Interest Income; State Obligations Avoid Tax
Interest Income; Taxable
Interest Set Aside; If Not Charitable, UBIT
Internet; World Wide Web
Inurement; Discounted Dues For 501(c)(7) Shareholders
Inurement; Prohibition By 501(c)(7)'s
Inurement; Refund Of Dues Previously Paid
Investment Tax Credit; Allocation Required
IRA's Direct Contribution
IRS 501(c)(7) Audit Checksheets And Instructions
IRS '78 Training Material
IRS '80 Training Material
IRS '85 Training Material
IRS '90 Training Material
IRS '91 Training Material
IRS '92 Training Material
IRS '94 Training Material
IRS '95 Training Material
IRS '99 Handbook On Social And Recreational Clubs
IRS '02 Training Material
IRS Examining Process; 501(c)(7)

L

Late Payment Charge
Leased Space In Clubhouse
Liquidation of 501(c)(7) Club; Exam By IRS In Progress
Liquidation of 501(c)(7) Club; Not A Taxable Event; For Now?
Liquidation of 501(c)(7) Club; Possible Taxable Event Interpretation
Liquidation Of Club Assets
Liquidation Of Club Assets; Aging Membership
Logo's And Trademarks; Licensing Agreement

M

Management Agreement; 501(c)(7) Status
Mandatory Service Charges; FICA
Marketing Incentives
Marketing Incentives; Dues Refunded
Marketing Incentives; Payments To Members
Marketing Options; Converting Nonmembers To Members
Meals; Employee Expense Deductions
Meals; Limitation Of Deduction
Member Income; Condo Sales To Members
Membership Deposits; Fee Deemed Nontaxable Loan
Membership Deposits; Loans
Membership Deposits; Refundable
Membership Fee; Capital Contribution
Membership Fee; Capital To Section 277 Club
Membership Fee; Gross Income
Membership Fee; Initial
Membership Fee; Loan Vs Income
Membership Fee; Taxable To Section 277 Club
Membership Redemption; Gain Reportable By Member
Membership Redemption; Gain To Members
Membership Redemption; Initiation Fee Included In Basis
Membership Redemption; Loss Not Deducted By Member
Membership Redemption; Ordinary Income To Club
Membership Redemption; Taxable Gain
Military Differential Pay
Mill River Plan; Pro Shop Arrangement
Minimum Wage; Tip Credit

N

National Club Championship; 501(c)(7) Charitable Set Aside
Nonmember Gross Receipts Defined
Nonmember Income; 15% / 35% Limitations
Nonmember Income; ADA Compliance
Nonmember Income; Dance Open To Public
Nonmember Income; Gratuitous Reimbursement
Nonmember Income; Guest Defined
Nonmember Income; Guest Pays
Nonmember Income; Limitation Computation
Nonmember Income; List
Nonmember Income; Loss Of 501(c)(7) Tax Status Real
Nonmember Income; Outside Groups Using Club
Nonmember Income; Privacy Issues
Nonmember Income; Public Accomodation; Single Rider Golf Cart Requirement?
Nonmember Income; Reimbursements As Contra Expenses
Nonmember Income; Revenue Procedure 71-17
Nonmember Income; Single Rider Golf Cars
Nonmember Loss; No Offset To Investment Income
Nonmember Losses; 277 Offset Of Member Income
Nonmember Losses; IRS Questions of 501(c)(7)'s
Nonmember Losses; Profit Motivated Rent
Nonmember Questionnaire
Nonmember Questionnaire; Transmittal Letter
Nonmember Sponsor Requirement
Nontraditional Business Activities
Nontraditional Business Activities; Wine And Liquor Sales To Members

O

Organizational Documents

P

Patron Of The Arts
Payroll Taxes; Unpaid; Responsibility?
Political & Lobbying Activities; 501(c)(7)'s PAC
Political & Lobbying Activities; Loss Of 501(c)(7) Status?
Prepaid Dues; An Alternative Method
Prepaid Dues; Change In Accounting Method
Prepaid Dues; Election
Prepaid Dues; Late Election
Privacy; Club's Rights Under State Law
Privacy; Men's Only Grill; Public Accomodations Deemed
Privacy; Tax Issues That May Affect A Challenge
POA; 501(c)(7) Club A Member Of POA
POA; Acquiring 501(c)(7) Club In A 368 Merger
POA; Assessments For Capital Expenditures
POA; Electing To Defer Or Refund Excess Amounts
POA; Member Activity In Sub Deemed Nonmember
POA; Membership In A 501(c)(7) Club
POA; Membership Payment To Club
Property Tax; Valuation Approach; Golf Club

Q

Qualified Plan; Asset Reversion on Termination

R

Rebates to Golf Pro's; "Golf Retirement Plus"
Reciprocal Arrangements
Reciprocal Arrangements; Expands Tax Issues At Club
Reciprocal Arrangements; Limitations On Expenses
Record Retention Schedule
Reduced Dues and Fees
Rent Income
Rent Income; Antenna On Roof Of 501(c)(7) Club
Rent Income; Part of 15 / 35% Nonmember Limitation
Rent Income; Room Rentals; 277 Club
Rent Income; Room Rentals; 501(c)(7)
Reorganization; Continuity Of Interest
Retirement Planning; 3 Years Of Retirement Catch-Up
Retirement Planning; 457 Limits After Year 2001
Retirement Planning; Repeal of Coordination Rules
Retirement Plans; 401(k)
Retirement Plans; Golf Retirement Plus
Retirement Promise To Pay
Retroactive 501(c)(7) Exemption
Retroactive 501(c)(7) Exemption; Avoiding 337 Tax

S

S Corporation Equity Certificates Nontaxable
SEC Registration; Club Membership
Section 277; Accumulated Earnings Tax
Section 277; Golf Clubs Subject To?
Section 277; Ignoring Limits
Section 277; NOL Carryback
Section 277; NOL Carryforward
Section 277; Rev. Proc. 71-17 May Apply
Section 277 Of The Code Explained
Section 277; Offset Member Losses Against Nonmember Income
Section 277; Offset Nonmember Losses Against Investment Income
Section 277; Offset Nonmember Losses Against Member Income
Serving Members Needs; Nontraditional Income
Single Rider Golf Carts; Disabled Access Credit
Social Security; Verify Numbers
State Nonprofit Corporation; Change To
State Sales Tax; Capitalize
Subsidary; Can 501(c)(7) Form One?
Subsidiary; Considered Activities Of 501(c)(7) Parent
Subsidiary; IRS Cannot Pierce Sub Under Section 277
Subsidiary; Leasing Space To The Public
Subsidiary; Moline Properties, Inc.; IRS Cannot Pierce Subsidiary
Summer Memberships; UBIT

T

Tennis Professional; Employee Based Upon Facts
Termination Defined Benefit Plan; UBIT
Termination Of 501(c)(7); How Made?
Termination Of 501(c)(7); Not Automatic
Time Clocks; Clocking In Early Or Late
Tipped Employee; Bag Staff
Tipped Employee; Employee Requirement
Tipped Employee; Employer Requirement
Tipped Employee; Employer Responsibility
Tipped Employee; Forms
Tipped Employee; Locker Room Attendant
Tipped Employee; Valet
Tips Explained For FICA, FUTA & Withholding
Tournament Hosting; Loss Of 501(c)(7) Status
Turnover; Asset Allocation
Turnover; Cash For Repairs
Turnover; Greens And Tee Costs
Turnover; How Are Club Assets Acquired?
Turnover; Net Operating Loss Carryover
Turnover; Purchase Of Assets
Turnover; Relinquish Documents
Turnover; Renegotiate Contracts
Turnover; Stock Purchase
Turnover; Titled Property

U

UBIT; Capital Gain Tax Rates
UBIT; Unrelated Business Income Tax
Uniforms

V

Valuation; Conservation Easement/501(c)(7) Application
Voluntary Gratuities; Wage & Hour

W

Wage & Hour; Assistant Pro; Hours Worked
Wage & Hour; Assistant Pros; Overtime Exemption; "Administration"
Wage & Hour; Assistant Pros; Overtime Exemption; "Executive"
Wage & Hour; Assistant Pros; Overtime Exemption; "Professional"
Wage & Hour; Classification Focus
Wage & Hour; Exemption
Wage & Hour; FairPay Overtime Protection
Wage & Hour; Minimum Wage
Wage & Hour; Overtime; Base Salary Test; Commissions On Lessons
Wage & Hour; Overtime; Guaranteed Salary; Fluctuating Workweek
Wage & Hour; Overtime; Mandatory Service Charges; Commission Sales Exemption
Wage & Hour; Overtime; Seasonal Exemption
Wage & Hour; Overtime; Seasonal Opeation & Receipts Test
Wage & Hour; Overtime Pay
Wage & Hour; Overtime Pay; Alternatives
Wage & Hour; Tipped Employees
Web Site; Development
Web Site; IRS May Visit
Working For Privileges

Y

Year End: 52-53 Week

CHAPTER 3: Club Articles On Club Tax Issues

401(k)'s And Retirement Planning

457 Deferred Compensation Plans And 501(c)(7)'s Problems
501(c)(7) Club Advertising For New Members
501(c)(7) Clubs Obtain New Revenue Ruling
501(c)(7) Loss Of Tax Exemption Real!
501(c)(7)'s - What Marketing Can We Do?
Are Clubs Overlooking A Technology Advance For Club Reciprocals?
Cash Tips; Should You Disclose?
Club Taxation: Developer-Initiated Tax Issues
Clubs Looking In All Of The Wrong Places: A 501(c)(7) Update
Determining Tax Status Of Caddies
Does A Section 457 Plan Work With 501(c)(7)'s
FIN 48: The Death of 501(c)(7) Tax-Exempt Clubs?
Final 337 Regulations Bad News For Clubs Wanting To Be 501(c)(7)
Golf / Tennis Pro - Employee Status
Great Ideas That Don't Work: A 501(c)(7) "Nontraditional" Primer
Identifying And Recording Nonmember Income
In Exchange: Reciprocal Arrangements Between 501(c)(7) Clubs
Insurance Against Loss Of Initiation Fees
Marketing Incentives - What Tax Costs?
Nonmember Income & Its Effects
Renovation Dollars And Sense: Understanding The Tax Ramifications Of A Club Renovation
Resale Of Memberships Under Section 277; IRS Position
Resources For The Club Treasurer
Section 277 And AMT
Should Clubs Consider Corporate Memberships?
Should Your Club Drop Tax Exempt Status?
Tangible Personal Property Tax
The Internet and 501(c)(7) Clubs
Under Contract: Employee Or Independent Contractor?
View Easements; An Unused Club Asset
What, Me Worry About Taxes?

CHAPTER 4: Club Manager Tax Planning

Charitable Giving
Employee Business Expenses
Long Term Care Insurance Plans
Professional Services
Retirement Planning

CHAPTER 5: Club Policy Statements and Glossary

Code of Ethics For Board Members Policy
Compensation Process Policy
Conflict-Of-Interest Policy
Contemporaneous Documentation Policy
Document Retention And Destruction Policy
Financial Investment Policy
Financial Statement Disclosure Policy
Form 990 Disclosure Policy
Form 1024 Disclosure Policy
Governing Documents Disclosure Policy
Joint Venture Policy
Providing Form 990 To Governing Body Policy
Safeguard 501(c)(7) Status Policy
Vendor Gift Policy
Whistleblower Policy
 
Glossary Of Terms

Club Treasurer's Work Book

Handbook
501(c)(7) New Club Treasurer's Handbook - Introduction to 501(c)(7) Social and Recreational Clubs
 
Checklists
501(c)(7)
501(c)(7); Advertising Checklist
501(c)(7); Disposition Of Club Asset Checklist
501(c)(7); Form 1024 Preparation For Tax-Exempt Status Checklist
501(c)(7); IRS Audit Preparation Checklist
501(c)(7); Nontraditional Income Checklist
501(c)(7); Privacy Checklist; Tax Related
501(c)(7); Recording Of Income For Tax Purposes Checklist
501(c)(7); Revenue Procedure 71-17 Checklist
501(c)(7); Section 277 Taxable Comparison Checklist
501(c)(7); Tax Issues Found In Operations Checklist
501(c)(7); Times To Be Tax-Exempt Checklist
501(c)(7); Web Site Checklist
 
A
Audit Committee Checklist
 
B
Board Tax Resolutions Checklist
 
C
Club Executive Year End Compensation Planning Checklist
 
E
Employee Vs Independent Contractor Checklist
 
F
Fair Labor Standards Act Checklist
 
G
Growing Your Club Checklist
 
T
Tipping Policy; Bag Staff Checklist
Tipping Policy; "Voluntary Gratuity" Vs "Mandatory Service Charge" Wage & Hour Checklist
 
Y
Year End Reporting Requirement Checklist