Are membership dues paid to a traditional fox-hunting and trap-shooting club subject to New York's club dues sales tax?

Plain-English summary

Old Chatham Hunt Club, Inc., a not-for-profit corporation chartered in 1953 and run by its members, exists to foster fox-hound and beagle hunting on horseback in the British tradition, plus trap shooting — it maintains a trap range and hound kennels, but has no fishing program and no social or athletic facilities (no meals, no clubhouse amenities typical of a country club). Members pay dues, fees, and assessments set by the bylaws to use the club's facilities and take part in its hunts.

New York generally taxes dues over $10 a year (and initiation fees over $10) paid to a "social or athletic club." But the Department has had a specific carve-out since October 1, 1996: dues and initiation fees paid to rod or gun clubs — fishing and hunting clubs — are no longer subject to that tax at all, a deliberate policy change announced in TSB-M-96(16)S. Based on the club's own charter purpose (fostering hunting and trap shooting), its actual facilities (a trap range and hunting kennels, nothing social or athletic), and how it actually operates, the Department found it squarely fits the rod-or-gun-club category, even without an active fishing program — "rod or gun club" is treated as covering hunting clubs generally, not just literal fishing-and-shooting combination clubs. So its members' dues, fees, and assessments are entirely exempt from the club dues tax.

What this means for you

Hunting, shooting, and sportsmen's clubs

If your club's real purpose and activities are hunting, trapping, or shooting sports (even without a fishing component), your membership dues and initiation fees are exempt from New York's club dues sales tax under the rod-or-gun-club carve-out — you don't need to charge or collect that tax on member dues.

Traditional social or athletic clubs considering this exemption

This exemption is narrow: it only reaches genuine rod or gun (hunting/fishing) clubs. A club offering social or athletic amenities alongside occasional hunting or shooting activities should look closely at its actual charter purpose, facilities, and operations before assuming the exemption applies — the Department looks at all three together.

Accountants and tax professionals

The controlling authority here is a 1996 policy reversal (TSB-M-96(16)S), not a statutory exemption written directly into section 1105(f) — worth flagging since a plain read of the club-dues statute wouldn't reveal this carve-out on its own.

Common questions

Q: Are dues paid to any hunting club automatically exempt from sales tax in New York?
A: They're exempt if the club is genuinely a rod or gun club under the Department's 1996 policy (TSB-M-96(16)S) — evaluated by the club's stated purpose, its actual facilities, and how it really operates, not just by name.

Q: Does the club need an active fishing program to qualify as a "rod or gun club"?
A: No — this club had no fishing activities at all and still qualified, because its hunting and shooting purpose and operations were enough to place it in the rod-or-gun-club category described in TSB-M-96(16)S.

Q: What tax would otherwise apply to club dues in New York?
A: Section 1105(f)(2) of the Tax Law taxes dues over $10/year (and initiation fees over $10) paid to social or athletic clubs — but rod or gun clubs have been fully carved out of that tax since October 1, 1996.

Citations and references

Statutes and rules:

• Tax Law § 1105(f)(2) (tax on dues and initiation fees paid to social or athletic clubs)
• 20 NYCRR 527.11(b) (definitions of "club or organization" and "athletic club")
• TSB-M-96(16)S (dues and initiation fees paid to rod or gun clubs no longer subject to sales tax, effective October 1, 1996)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_2004.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a04_13s.pdf

Original ruling text

New York State Department of Taxation and Finance

Office of Tax Policy Analysis
Technical Services Division

TSB-A-04(13)S
Sales Tax
May 24, 2004

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S030702A

On July 2, 2003, the Department of Taxation and Finance received a Petition for Advisory
Opinion from Old Chatham Hunt Club, Inc., P.O. Box 93 Old Chatham, NY 12136.
The issue raised by Petitioner, Old Chatham Hunt Club, Inc., is whether dues paid by its
members are dues or initiation fees paid to a rod or gun club which are not subject to sales tax.
Petitioner submitted the following facts as the basis for this Advisory Opinion.
Petitioner was chartered as a not-for-profit corporation in 1953 and is governed by its
membership. The club maintains a trap range for shooting and promotes hunting on horseback with
fox hounds and beagles in the British tradition, but does not sponsor fishing. In addition to the trap
range, the club maintains a beagle kennel and a fox hound kennel. It has no facilities for the social
or athletic activities of its members and does not sell meals or provide services traditionally
associated with social or athletic clubs.
The members pay dues, fees and assessments as established by Petitioner’s Bylaws for the
use of its facilities and to participate in the club hunts.
Petitioner’s Bylaws provide, in part:
Article II. (1) The object and purpose of this corporation shall be to foster hunting
with fox hounds and beagles, and trap shooting.
Applicable law and regulations
Section 1105(f) of the Tax Law imposes sales tax, in part, on:
(2)(i) The dues paid to any social or athletic club in this state if the dues . . . are in
excess of ten dollars per year, and on the initiation fee alone, regardless of the amount of
dues, if such initiation fee is in excess of ten dollars. . . .
Section 527.11(b) of the Sales and Use Tax Regulations provides, in part, the following
definitions of terms that are contained in section 1105(f)(2) of the Tax Law:
(5) Club or organization. (i) The phrase club or organization means any entity which
is composed of persons associated for a common objective or common activities. Whether
the organization is a membership corporation or association or business corporation or other
legal type of organization is not relevant. Significant factors, any one of which may indicate

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TSB-A-04(13)S
Sales Tax
May 24, 2004
that an entity is a club or organization, are: an organizational structure under which the
membership controls social or athletic activities, tournaments, dances, elections, committees,
participation in the selection of members and management of the club or organization, or
possession by the members of a proprietary interest in the organization. The organizational
structure may be formal or informal. (Emphasis supplied)
(ii) A club or organization does not exist merely because a business entity:
(a) charges for the use of facilities on an annual or seasonal basis, even if an
annual or season pass is the only method of sale and provided such passes are sold
on a first-come, first-served basis;
(b) restricts the size of the membership solely because of the physical size of
the facility. Any other type of restriction may be viewed as an attempt at exclusivity;
(c) uses the word club or member as a marketing device;
(d) offers tournaments, leagues and social activities which are controlled
solely by the management.
*

*

*

(7) Athletic club. (i) An athletic club is any club or organization which has as a
material purpose or activity the practice, participation in or promotion of any sports or
athletics.
Technical Services Bureau Memorandum, entitled Dues and Initiation Fees Paid to Rod or
Gun Clubs No Longer Subject to Sales Taxes, December 23, 1996, TSB-M-96(16)S, provides in
part:
Effective for membership periods beginning on or after October 1, 1996, dues and
initiation fees paid by members to rod or gun clubs (e.g., fishing and hunting clubs) are no
longer subject to the New York State and local sales taxes. These taxes were imposed under
sections 1105(f)(2), 1107 and 1109 of Article 28 and pursuant to the authority of Article 29
of the Tax Law. The Tax Department has examined its longstanding policy concerning the
taxability of dues and initiation fees paid to these clubs and has determined that such policy
should be revised.
Opinion
Petitioner is a nonprofit corporation which is governed by it membership. Petitioner’s object
and purpose is to foster hunting with fox hounds and beagles, and trap shooting. The members pay

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TSB-A-04(13)S
Sales Tax
May 24, 2004
dues, fees and assessments as established by Petitioner’s Bylaws for the use of its facilities and to
participate in the club hunts.
Petitioner is a member owned corporation created for the purpose of fostering hunting with
fox hounds and beagles, and trap shooting. Based upon its stated purposes as reflected in its
corporate charter and Bylaws, its activities, and its actual operation as represented in this Advisory
Opinion, Petitioner is a hunting club, or rod or gun club, within the meaning of TSB-M-96(16)S,
supra. Therefore, the membership dues or fees paid by its members are not subject to the tax
imposed by section 1105(f) of the Tax Law. See TSB-M-96(16)S, supra.

DATED: May 24, 2004

NOTE:

/s/
Jonathan Pessen
Tax Regulations Specialist IV
Technical Services Division

The opinions expressed in Advisory Opinions are
limited to the facts set forth therein.