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Nonprofit Law/501 (c)(7) Tax Status - Marketing / Advertising


Mr. Mechanic,

We are a group of students at Montana State University - Billings researching the tax status of 501(c)(7). We are not having any luck in requesting help from local CPAs and went to the internet for answers. We are currently working with a business who is registered as a 501 (c)(7). We are wondering what opportunities there are for us to help them market / advertise their social club (this is not a golf course).

Additionally, if we were to end up recommending them transitioning from their current tax status, to becoming open to the public, how difficult of a task would this be and what steps would need to be taken?

Any insight that you can offer is greatly appreciated.

Thank you in advance,

Jennifer Ullman

I have in my profile that this free forum is only for general questions about IRS federal exemption issues of 501(c)(3) organizations. But I will try to direct you somewhat. The IRS writes about 501(c)(7) organizations at and specifically see as to the factors that the IRS would look at to see if it is a private club and not a public establishment.

If they want to have club for the public for recreation or social activities, then they would need to set up a for-profit business and, if they wish, end the exempt organization.

You are welcome.

Harvey Mechanic
Attorney at Law

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.

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Harvey Mechanic


I am an attorney and I volunteer time to answer general questions about U.S. Federal income tax issues of nonprofit 501(c)(3) public charities only. Those questions could be about establishing and maintaining legal requirements for such non-profit organizations in the United States, including Internal Revenue service filings and requirements. I will not be working on this free forum to answer questions about Nonprofit's possible unrelated or for-profit businesses or how to fill out forms. This forum is only for general questions about federal tax law, not as the law applies to your specific situation. If you do not make your question public then I will not be spending much of my donated time on answers that would not benefit the public. If you have other questions, please contact me at I will reply from my email. In any case, do not reveal confidential information to me until after I have contracted with you to provide personal legal services. My responses on this forum are intended to be general statements of law, should not be relied upon as legal advice, and do not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather extensive information about the situation. To search my previous answers you can do a Google search by "" without the quotes and then add your search terms before hitting enter.


I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar and I have maintained my status with the Bar since that time.


B.S. Columbia University in New York City, 1970

J.D. (Law Degree) Brooklyn Law School, 1990 -- Cum Laude.

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