Is
your club prepared to venture online with a Web page? Perhaps your club has
already gone virtual. If the most recent PGA Show in Orlando and the Club
Managers Association of America Conference in Atlanta
are any indication, vendors are lining up and are, prepared to assist in designing
and hosting your club's Web site. Currently, there are many and more frequent
questions being asked about the content of club Web pages. If your club has
elected to be tax exempt under Section 501(c)(7) of the Internal Revenue Code,
this article will be of particular interest to you.
When the time comes to ask the piercing tax questions regarding a 501(c)(7) tax-exempt club Web page, a person needs to think like an IRS agent. An IRS Agent would view a Web site by specifically looking for evidence of clubs generating nonmember income. Nonmember income often leads to potential tax liabilities being assessed by the IRS. Terminating the 501(c)(7) tax-exempt status by an agent could lead to big dollars for the U.S. Treasury. This article is as much about raising questions in the minds of club managers, club controllers and club board members as it is an attempt to dissect any particular tax law that applies to a 501(c)(7) club. As the reader, you may come away with changed thoughts about your own club's Web page.
Why does your club want a web site?
What tax-exempt purpose does the web site meet?
Why would a club take the chance of experiencing a problem with the IRS?
What does your club want to accomplish with a web site?
Who should review and approve your club web site?
What are some of the more unusual items found on club Web sites?
Have a question? E-mail us?
Adapted from an article appearing in the April/May 2003 issue of The Boardroom magazine, the magazine for Private Club Directors and Management