501(C)7 Non-profit & membership dues

ChrisG306 — Fri, 01 Nov 2019 17:06:39 GMT

I'm finding some confusing lack of clarity on whether I can accept membership dues for my social club.

We are a US Federally recognized non-profit club under the 501(C)7 section of the tax code. We are recognized as a non-profit business in our state of operation as well. Under the 501(C)7 tax code, we have to have a set of membership qualifications and one of them for us is the paying of annual dues. We do NOT do automatic invoicing; you renew at your discretion or you don't and you lose your membership.

Is using Square for this is a violation of the terms of service?

Confusion comes from the following:

https://squareup.com/us/en/legal/general/payment
Payment terms
3. Unsupported Industries: ...(3) buyers or membership clubs, including dues associated with such clubs,...

And then:
https://squareup.com/us/en/solutions/nonprofit
This page specifically says "Square is one service for your entire organization, from collecting membership dues to free point-of-sale software"

Can someone define what Square means by membership clubs? Can my org continue to use Square at all? If we fall under that definition, then... can we keep using it for the small amount of retail sales we do that ISN'T dues related?

Thank you!

Chris

Re: 501(C)7 Non-profit & membership dues

JustinC — Mon, 04 Nov 2019 16:54:22 GMT

Hey @ChrisG306

Ah, totally understand the confusion here. I got clarity about this from our Compliance Team - the main thing to note is we only prohibit long term memberships (i.e. more than a year). Since you mentioned these dues are annual, you're in the clear based on that information alone.

In regards to your other question, you can definitely sell your retail products with Square. Let me know if you need anymore help with this!

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501(C)7 Non-profit & membership dues

Re: 501(C)7 Non-profit & membership dues