Fort Bragg, CA asked in Business Formation, Tax Law and Business Law for California

Q: What would be the legal/tax requirements of starting a small beer tasting "club"?

I would like to start a "beer club" in my area where enthusiasts can meet up every month to sample and discuss beer. This would involve collecting a small fee for anybody who wants to meet up, just to cover costs, and whatever is left being saved for the following month. Would this have any specific legal requirements such as officially registering as a "social club" or anything of that nature? I live in California if that helps.

1 Lawyer Answer
James L. Arrasmith
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  • Tax Law Lawyer
  • Sacramento, CA
  • Licensed in California

A: In California, starting a beer tasting club may have legal and tax requirements, depending on how you structure the club and how you handle the fees collected.

If the beer club is simply a group of enthusiasts meeting to sample and discuss beer, with no formal organization or structure, there may be no legal requirements. However, if you plan to collect fees from members to cover costs and save for future events, there may be tax implications.

If the beer club is considered a non-profit organization, you may need to obtain tax-exempt status from the IRS and file annual tax returns. If the club is not a non-profit, the fees collected may be considered income and subject to income taxes. You may also need to register for a business license and comply with local zoning and health codes if you plan to hold events at a commercial location.

To ensure compliance with all applicable laws and regulations, you may want to consult with a business attorney and/or a tax professional who can advise you on the specific legal and tax requirements for starting a beer club in California.

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