Did a nonprofit community club have to collect Florida admissions tax on voluntary member payments for recreational activities?

Subject

Admissions Paid to a Club

Plain-English summary

In the original ruling, the club had to collect and remit Florida sales tax on its admissions charges. The nonprofit private club organized sporting and recreational activities for community residents, including tennis, shuffleboard, shows, dances, dinners, and other member functions. The Department treated dues and fees for its recreational or physical-fitness facilities as taxable admissions.

The exception for certain condominium, homeowners, or cooperative-association payments did not apply to the stated facts. The club had not clearly established that it was a homeowners association, and the petitioner said the payments were not required as a condition of owning or occupying real property.

The official document begins with a status notice directing readers to revised TAA 97A-041R, issued November 10, 1997. This page therefore explains the original ruling only.

What this means for you

For the original facts, limiting activities to residents and invited guests and operating as a nonprofit did not remove the admissions tax. The property-association exception depended on mandatory payments tied to ownership or occupancy and qualifying common facilities, not simply on the club's community purpose.

Common questions

Q: Were the club's recreation-related member payments taxable? Yes, under the original ruling.

Q: Did nonprofit status create an exemption? No exemption was granted on that basis in this ruling.

Q: Why did the property-association exception fail? The club's status as a homeowners association was unclear, and the payments were not mandatory as a condition of property ownership or occupancy under the original facts.

Q: Can this original ruling be read without the revision? No. The official text expressly says to see revised TAA 97A-041R.

Citations and references

• Fla. Stat. § 212.04 — tax on admissions
• Fla. Stat. § 212.02(1) — definition of admissions, including certain private-club dues and fees
• Fla. Admin. Code r. 12A-1.005(5)(d)2.d. — exception for qualifying mandatory property-association payments
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 97A-041

Original ruling text

Status: See Revised TAA 97A-041R issued November 10, 1997

Jun 12, 1997

Re: Technical Assistance Advisement 97(A)-041
Sales and Use Tax - Admissions Paid to a Club
Sections: 212.02, 212.04, F.S.
Rule: 12A-1.005, F.A.C.
Petitioner: XXX

Dear:

This is a response to your petition received April 3, 1997, for
the Department's issuance of a Technical Assistance Advisement
("TAA") concerning the above referenced matter as applied to XXX
(Club). Your petition has been carefully examined and the
Department finds it to be in compliance with the requisite
criteria set forth in Chapter 12-11, F.A.C. This response to
your request constitutes a TAA and is issued to you under the
authority of s. 213.22, F.S.

STATED FACTS

You provide the following facts, in part:

Club, is a Not-For-Profit Corporation organized pursuant to
the Not-For Profit Law of the State of Florida, set forth
in part one of Chapter 617 of the Florida Statutes.

The primary purpose for which this Corporation was formed
is to promote better living conditions throughout the...
Community....

In furtherance of such purpose, the corporation shall have
power to promote fellowship, goodwill, entertainment,
organize sporting, recreational and fund raising activities
among the residents of the... Community, and provide
services of a general nature to the members of the Club.
....

As outlined above, we are a Club organized specifically for
the residents of the... Community. We do not hold
ourselves out as a commercial Club where admission is open
to the public. One must be a member of the... Community or
their invited guest to attend a function.

The following are functions that are provided for and by
the members: shows made up of members, dances, Koffee
Klatch, dinners prepared and served by members. The
charges for these functions are to primarily cover costs
and in some cases are free will donations....

You also indicate in your letter that you are a member of the
club.

By telephone conference, you indicated that the dues or fee
payments were not required to be paid as a condition of
ownership or occupancy of real property. You further stated
that "recreation" as provided in your request included but was
not limited to tennis, shuffleboard, and other sports
activities.

REQUESTED ADVISEMENT

You ask whether Club is required to collect and remit Sales tax
on the admissions charge.

LAW AND ANALYSIS

Section 212.04, F.S, provides in part:

*212.04 Admissions tax; rate, procedure, enforcement.-(1)(a) It is hereby declared to be the legislative intent
that every person is exercising a taxable privilege who
sells or receives anything of value by way of admissions.

(b) For the exercise of such privilege, a tax is levied at
the rate of 6 percent of sales price, or the actual value
received from such admissions, which 6 percent shall be
added to and collected with all such admissions from the

purchaser thereof, and such tax shall be paid for the
exercise of the privilege as defined in the preceding
paragraph. (E.S.)

The term "Admissions" is defined in part under s. 212.02(1),
F.S., as:

212.02 Definitions.
The following terms and phrases when used in this chapter
have the meanings ascribed to them in this section, except
where the context clearly indicates a different meaning:

(1) The term "admissions" means and includes... and all
dues and fees paid to private clubs and membership clubs
providing recreational or physical fitness facilities,
including, but not limited to, golf, tennis, swimming,
yachting, boating, athletic, exercise, and fitness
facilities, except physical fitness facilities owned or
operated by any hospital licensed under chapter 395. (E.S.)

Here, it is clear that Club, is a private club which collects
dues and fees for the use of its recreational or physical
fitness facilities. As you indicated, the club organizes
sporting and recreational activities, including tennis,
shuffleboard and other sports for its members.

Rule 12A-1.005(5)(d)2. d., F.A.C., interprets the statutes on
the taxability of admissions regarding homeowner's associations.
That section provides, in part:

12A-1.005 Admissions.
...
(5) DUES AND INITIATION FEES, EQUITY AND NONEQUITY
MEMBERSHIPS, CAPITAL CONTRIBUTIONS AND ASSESSMENTS,
REFUNDABLE AND NONREFUNDABLE DEPOSITS, AND USER FEES.
...
(d)...

2. The following payments made to private clubs or
   membership clubs are not "fees" which are subject to tax on
   admissions....

d. Mandatory dues and fees paid to a condominium
association, homeowners' association, or cooperative
association when they are required to be paid as a
condition of ownership or occupancy of real property and
the club facilities are part of the common elements or
common areas of the real property. (E.S.)

It is not clear that Club is a homeowner's association. Even if
Club were a homeowner's association, because the subject
payments were not required to be made as a condition of
ownership or occupancy of real property, the provisions of Rule
12A-1.005(5)(d)2.d., F.A.C., do not apply. Therefore, under the
above statute and rule, the member payments made to club are
taxable.

CONCLUSION

Club is required to collect and remit Sales tax on the
admissions charge.

RECORD KEEPING

According to Florida law, every taxpayer has the duty to
maintain adequate books and records.

Section 212.13(2), F.S., provides in part:

(2) Each dealer, as defined in this chapter, shall secure,
maintain, and keep as long as required by s. 213.35 a
complete record of tangible personal property or services
received, used, sold at retail, distributed or stored,
leased or rented by said dealer, together with invoices,
bills of lading, gross receipts from such sales, and other
pertinent records and papers as may be required by the
department for the reasonable administration of this
chapter; all such records which are located or maintained
in this state shall be open for inspection by the
department at all reasonable hours at such dealer's store,
sales office, general office, warehouse, or place of
business located in this state.... Any dealer subject to

the provisions of this chapter who violates these
provisions is guilty of a misdemeanor of the first degree,
punishable as provided in s. 775.082 or s. 775.083. (E.S.)

Section 213.35, F.S., provides:

Each person required by law to perform any act in the
administration of any tax enumerated in s. 72.011 shall
keep suitable books and records relating to that tax, such
as invoices, bills of lading, and other pertinent records
and papers, and shall preserve such books and records until
expiration of the time within which the department may make
an assessment with respect to that tax pursuant to s.
95.091(3). (E.S.)

Section 212.12(6), F.S., expressly provides, in part:

(6)(a) ... It shall be the duty of every person required to
make a report and pay any tax under this chapter,... to
keep and preserve suitable records of the sales, leases,
rentals, license fees, admissions, or purchases, as the
case may be, taxable under this chapter; such other books
of account as may be necessary to determine the amount of
the tax due hereunder; and other information as may be
required by the department.... (E.S.)

This response constitutes a Technical Assistance Advisement
under s. 213.22, F.S., which is binding on the Department only
under the facts and circumstances described in the request for
this advice as specified in s. 213.22, F.S. Our response is
predicated on those facts and the specific situation summarized
above. You are advised that subsequent statutory or
administrative rule changes or judicial interpretations of the
statutes or rules upon which this advice is based may subject
similar future transactions to a different treatment than
expressed in this response.

You are further advised that this response and your request are
public records under Chapter 119, F.S., which are subject to
disclosure to the public under the conditions of s. 213.22, F.S.
Your name, address, and any other details which might lead to

identification of the taxpayer must be deleted by the Department
before disclosure. In an effort to protect confidential
information, we request you notify the undersigned in writing
within 15 days of any deletions you wish made to the request or
this response.

Should you have any further questions concerning this matter,
please do not hesitate to contact me.

Sincerely,

Eric A. de Moya, Esq.
Tax Law Specialist
Technical Assistance and Dispute Resolution
(904)922-4714

NOTICE UNDER THE AMERICANS WITH DISABILITIES ACT

Persons needing an accommodation to participate in any
proceeding before the Department of Revenue, should contact the
Department at (904)488-0717 (voice), or 1-800-DOR-8331 (TDD), at
least five working days before such proceeding. You may also
call via the Florida Relay System at 1-800-955-8770

Control No. 28538