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The Curious Bag
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A 501(c)(7) corporation is a non-profit social and recreational organization. The designation of 501(c)(7) certifies this organization's tax-exempt status to the United States Internal Revenue Service.
Examples
Some examples of social and recreational organizations that may be eligible for tax exempt status are country clubs, hobby clubs (like classic car buffs), garden clubs, sporting clubs for amateurs (like hunting fishing, volleyball, swimming) and some college organizations not accounted for in other IRS regulations.
Social Benefit
All activities carried out by the organization must be for the social benefit of its members. Opening facilities to the general public may violate a club's 501(c)(7) status.
Discrimination
An application for 501(c )(7) status will be denied if any evidence of discrimination is present, for example, excluding a prospective member because of race, religion or color. Some religious clubs, however, may be exempt from this rule. Check the IRS standards.
Profit
Tax-exempt status will also be denied if the organization conducts business to make a profit. All earnings must come from member dues, fees and other assessments.
Application
To form a 501(c)(7) corporation, file Form 1024 with the Internal Revenue Service. A downloadable version can be found at the IRS website, irs.gov.
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