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Nonprofit Law/gift with membership fee

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Question
We are a diving club with 501(c)3 non-profit status. We are considered a non-profit to promote the sport of diving in our community.

We require divers who are going to compete with our club to become members and pay different levels of dues based on their level of competition: $75 for future champion (beginner), $100 for novice (intermediate) and $150 for junior olympic (advanced). In the past all levels have gotten a team shirt included in their membership dues.

This year we are considering increasing the membership dues some and including a team suit and a team shirt with the member dues. A potential issue is that the team suits cost different amounts for boys and girls (a potential difference of about $20-30).

the question comes in the pricing of the dues: Can we charge the same membership dues for each of the levels, regardless of the suit cost?  Or do we need to charge separately based on the price of the suit (boys or girls)?

Some on our board are concerned the same price for each level, regardless of suit cost could be construed as benefiting some kids more than others (ie the girls who get the higher priced suits).  But on the other hand, it seems gender-biased to charge different prices based on boys/girls suit cost.

We look forward to your advice!

Answer
I have in my profile that this free forum is only for general questions about IRS federal exemption issues of 501(c)(3) organizations. The IRS does not have any regulation prohibiting a 501(c)(3) youth organization from providing suits to all participants even though some, on the basis of gender, costs more.

I did notice your title and you have "gift with membership fee".   As to charitable deductions, see IRS Publication 526 "Charitable Donations" which is available at  http://www.irs.gov/pub/irs-pdf/p526.pdf
on page 4, first column, "You may be able to deduct membership fees or dues you pay to a qualified organization. However, you can deduct only the amount that is more than the value of the benefits
you receive."  It appears that all of the fees would be treated like school tuition.  In other words, none is deductible as a charitable donation.

Harvey Mechanic
Attorney at Law
Harvey108@hotmail.com

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. For me to consider your individual situation and how the law applies, I would need to gather more information.

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Harvey Mechanic

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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 Harvey108@hotmail.com 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 "site:allexperts.com/q/nonprofit" without the quotes and then add your search terms before hitting enter.

Experience

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.

Education/Credentials

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

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


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