Dues for Clubs and Organizations
What You May Deduct
You may deduct costs for dues to professional organizations and those organizations which you can show are necessary to conducting your business. For example, your dues to the Chamber of Commerce are deductible if you can show that your Chamber membership allows you to promote your business.
- Boards of trade
- Business leagues
- Chambers of commerce
- Civic or public service organizations
- Professional organizations such as bar associations and medical associations
- Real estate boards
- Trade associations.
What You May Not Deduct
You may not deduct dues to personal or hobby clubs or groups, or dues/memberships paid to country clubs, recreation or social groups.
Where to Show these Expenses
- For sole proprietors and single-member LLCs, show these expenses in the "Expenses" section of Schedule C
- For partnerships and multiple-member LLCs, show these expenses in the "Deductions" section of Form 1065
- For corporations, show these expenses in the "Deductions" section of Form 1120.
If you pay club dues for an employee, this is considered compensation, even though you cannot deduct it as a business expense. You must report this compensation to the IRS and the employee must pay income tax on this compensation.
This article presents general information; I am not a tax attorney or tax preparation specialist. Refer to IRS publications and refer questions to your tax consultant.