Nonprofit Law/Car Club


My and a group of friends started a car club in California, and as a club we plan on raising money for activities (ex: selling T-shirts with the club logo)
1. would we still be considered a non-profit organization?
2. Do we need to file for 501(c)(7) status with the IRS?

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 give you some information. The IRS gives some details about social and/or recreational organizations at

If you are going to be selling the t-shirts to non-members, then note the limitations as to income from the public also cautions as to when such income is taxable.

From what you informed me I would not yet be able to answer whether you would qualify for 501(c)(7) organization status.   If you want to hire me to analyze your proposed operation, send me an email directly to my email address below and I will quote you my fees.  But, if you are qualified, you wuld not be required to file for 501(c)(7) organization status with the IRS. --- Start of Excerpt ---
IRC 501(c) organizations other than IRC 501(c)(3), IRC
501(c)(4),IRC 501(c)(9), or IRC 501(c)(17) organizations are not
required to file an application for exemption, though they may do
so. They may be considered exempt even though they do not apply for
a formal exemption as long as they satisfy the requirements of the
particular paragraph of IRC 501(c) they claim exemption under.
Also, if they do not establish exempt status by application to
Cincinnati, they are at risk of retroactive revocation and taxation
if they are found not to be engaged in activities described by the
subsection under which they filed.
---End of Excerpt---

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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