Q: Can our 501C7 club lease kitchen for public dining without tax issues?
Our private club has a 501C7 tax designation and previously employed its own kitchen staff for private dining. Due to financial constraints from a decline in membership, we can no longer maintain the kitchen staff. A local restaurant has offered to lease our kitchen for public dining while the rest of the club remains private. We plan to have a lease agreement with specific terms outlining boundaries and responsibilities, with public access through the front entrance and private areas cordoned off. No income will be derived from the public dining, only from the lease agreement. The lease is on an annual reconsideration, and we will amend our bylaws accordingly. Is this arrangement compliant with our 501C7 status without causing any legal issues?
Justia Ask A Lawyer is a forum for consumers to get free answers to basic legal questions. Any information sent through Justia Ask A Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between Justia and you, or between any attorney who receives your information or responds to your questions and you, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask A Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises, or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.
