I pay an annual individual affiliate fee to the Transportation Research Board for library access, meeting discounts, and publications -- does New York charge sales tax on that fee?

Plain-English summary

Lawrence F. Hughes, an individual with a professional and academic background in transportation issues, paid an annual fee to become an individual affiliate of the Transportation Research Board (TRB) -- one of six divisions of the National Research Council, the principal operating arm of the National Academies (the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine), a private, nonprofit institution chartered by Congress in 1916 to advise the federal government on science, technology, and engineering matters. TRB's mission is to advance transportation research and information exchange in an objective, interdisciplinary setting, drawing on more than 7,000 engineers, scientists, and practitioners who serve on its committees, panels, and task forces. Hughes attends TRB's multi-day annual meetings -- which include workshops, committee and panel discussions, and presentations -- and has personally participated in committee and panel discussions there.

His annual affiliate fee buys him a package of benefits: use of TRB's library, a reduced registration fee for the annual meeting, a complimentary subscription to TR News, eligibility to participate in TRB's subscription service, a discount on most TRB publications (including TRR Journal Online), and announcements of the annual meeting and other professional conferences.

Hughes asked the Department whether this individual affiliate fee is subject to New York sales tax.

The Department held no -- the fee is not taxable. New York's sales tax reaches "dues" only when paid to a "social or athletic club" (Tax Law §1101(d)(6) and (13); §1105(f)(2)(i)) -- an organization whose material purpose or activity is arranging periodic social functions (dances, dinners, meetings for social interrelationship) or the practice, participation in, or promotion of sports or athletics (Sales and Use Tax Regulations §527.11(b)(5)-(7)). Based on the facts submitted, TRB's activities center on transportation research, information exchange, and professional/technical services -- not on arranging social functions or promoting athletics -- so TRB is not a social or athletic club, and Hughes's affiliate fee is not taxable "dues" under section 1105(f). The Department also confirmed the fee is not a taxable retail sale of tangible personal property under section 1105(a), nor a taxable enumerated service under section 1105(c); rather, it is a membership fee paid to join and support a professional organization. The Department pointed to its own prior opinion, Sea Tow Services International, Inc. (TSB-A-01(23)S), which similarly held that membership fees paid to organizations that are not social or athletic clubs -- even where they entitle members to various benefits and services -- are not subject to the section 1105(f) dues tax. Bottom line: annual fees paid by individual affiliates to the Transportation Research Board are not subject to New York sales tax.

What this means for you

Individual members of professional or research associations

If your membership or affiliate fee to a professional society or research organization buys you things like library access, discounted event registration, publication discounts, and a newsletter subscription -- and the organization's material purpose isn't arranging social gatherings or promoting sports/athletics -- your fee is likely exempt from New York sales tax for the same reason TRB's affiliate fee was here.

Nonprofit research organizations and professional societies

Organizations like TRB and the National Research Council that charge annual affiliate or membership fees tied to research, publications, and conference benefits (rather than social or athletic activities) can point to this opinion, and to Sea Tow Services International (TSB-A-01(23)S), as Department precedent that such fees are not taxable dues.

Accountants and tax professionals

This opinion illustrates the narrow scope of "dues" taxable under Tax Law §1105(f)(2)(i): only fees paid to a bona fide "social or athletic club," as defined by Tax Law §1101(d)(13) and Regulations §527.11(b), are taxed. When a client's organization has no material social or athletic purpose, its membership fees generally escape both the dues tax and taxation as a sale of tangible personal property or an enumerated service.

Common questions

Q: Do I owe New York sales tax on a membership or affiliate fee I pay to a professional or research organization?
A: Only if the organization is a "social or athletic club" under Tax Law §1101(d)(13) -- meaning its material purpose or activity is arranging social functions (like dances or dinners) or promoting sports or athletics. A research- and profession-focused organization like the Transportation Research Board generally is not.

Q: What did Hughes get for his TRB affiliate fee, and did the specific benefits matter?
A: Library access, a discounted annual-meeting registration fee, a TR News subscription, subscription-service eligibility, publication discounts, and meeting announcements. What mattered to the Department wasn't that he received benefits, but that none of TRB's activities were social or athletic in nature.

Q: Could the fee still have been taxed some other way, like a charge for goods or services?
A: The Department checked both possibilities and ruled them out: the fee is not a receipt from a retail sale of tangible personal property under section 1105(a), nor a receipt from an enumerated taxable service under section 1105(c).

Q: Does this ruling protect other TRB affiliates, or other professional organizations, from sales tax on their dues?
A: Not directly. It's an Advisory Opinion binding only on Hughes and only as to the facts he described. Other affiliates and similarly structured organizations can look to it, and to Sea Tow Services International (TSB-A-01(23)S), as informal guidance, but would need their own opinion to rely on one.

Q: Why does this opinion name the individual petitioner and his address, when most others redact that information?
A: Unlike many TSB-A opinions summarized in this corpus, this one identifies the petitioner, Lawrence F. Hughes, and his home address, directly in the published text rather than redacting them.

Citations and references

Statutes and regulations:

• Tax Law §1101(d)(6) (definition of "dues")
• Tax Law §1101(d)(13) (definition of "social or athletic club")
• Tax Law §1105(a) (tax on retail sales of tangible personal property)
• Tax Law §1105(c) (tax on enumerated services)
• Tax Law §1105(f)(2)(i) (tax on dues paid to a social or athletic club)
• Sales and Use Tax Regulations §527.11(b)(5) (definition of "club or organization")
• Sales and Use Tax Regulations §527.11(b)(6) (definition of "social club")
• Sales and Use Tax Regulations §527.11(b)(7) (definition of "athletic club")

Prior opinions referenced:

• Sea Tow Services International, Inc., TSB-A-01(23)S (membership fees paid to non-social/non-athletic organizations are not taxable dues)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_2008.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a08_38s.pdf

Original ruling text

New York State Department of Taxation and Finance

Office of Tax Policy Analysis
Taxpayer Guidance Division

TSB-A-08(38)S
Sales Tax
August 22, 2008

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S070724C

On July 24, 2007, the Department of Taxation and Finance received a Petition for
Advisory Opinion from Lawrence F. Hughes, 42-65 Kissena Boulevard, Apartment 609,
Flushing, New York 11355-3267. Petitioner, Lawrence F. Hughes, provided additional
information pertaining to the Petition on March 24, 2008.
The issue raised by Petitioner is whether individual fees paid to the Transportation
Research Board are subject to sales tax.
Petitioner submitted the following facts as the basis for this Advisory Opinion.
The Transportation Research Board is one of six major divisions of the National
Research Council, a private, nonprofit institution that is the principal operating agency of the
National Academies in providing services to the government, the public, and the scientific and
engineering communities. The National Research Council is jointly administered by the
National Academy of Sciences, the National Academy of Engineering, and the Institute of
Medicine. The Transportation Research Board’s varied activities annually engage more than
7,000 engineers, scientists, and other transportation researchers and practitioners from the public
and private sectors and academia, all of whom contribute their expertise in the public interest by
participating on Transportation Research Board committees, panels, and task forces. The
program is supported by state transportation departments, federal agencies including the
component administrations of the U.S. Department of Transportation, and other organizations
and individuals interested in the development of transportation. The mission of the
Transportation Research Board is to provide leadership in transportation innovation and progress
through research and information exchange, conducted within a setting that is objective,
interdisciplinary, and multimodal. In an objective and interdisciplinary setting, the Board
facilitates the sharing of information on transportation practice and policy by researchers and
practitioners; stimulates research and offers research management services that promote
technical excellence; provides expert advice on transportation policy and programs; and
disseminates research results broadly and encourages their implementation.
The National Research Council is part of the National Academies, which also comprise
the National Academy of Sciences, National Academy of Engineering, and Institute of Medicine.
They are private, nonprofit institutions that provide science, technology, and health policy advice
under a congressional charter. The Research Council was organized by the National Academy of
Sciences in 1916 to associate the broad community of science and technology with the
Academy’s purposes of furthering knowledge and advising the federal government. Functioning
in accordance with general policies determined by the Academies, the National Research

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Council has become the principal operating agency of both the National Academy of Sciences
and the National Academy of Engineering in providing services to the government, the public,
and the scientific and engineering communities. The Research Council is administered jointly by
both Academies and the Institute of Medicine through the National Research Council Governing
Board.
As a resource to the nation and to the transportation community worldwide, the
Transportation Research Board provides an extensive portfolio of services. Among these
services are opportunities for information exchange on current transportation research and
practice, management of cooperative research and other research programs, analyses of national
transportation policy issues and guidance on federal and other research programs, and
publications and access to research information from around the world.
Institutional, individual and student affiliates contribute to the support of the
Transportation Research Board activities through annual fees. Benefits received by individual
affiliates upon payment of the annual fee include use of the Transportation Research Board’s
library, a reduction in the registration fee for the Transportation Research Board annual meeting,
receipt of a complimentary subscription to TR News (a journal of current transportation research
and news), eligibility to participate in the Transportation Research Board subscription service, a
discount on single copies of most publications of the Transportation Research Board, including
subscriptions to TRR Journal Online (Transportation Research Record: Journal of the
Transportation Research Board), and announcements of the annual meeting and other
professional conferences.
Petitioner has a professional and academic background in transportation issues, and has
paid the annual fee to become an individual affiliate of the Transportation Research Board.
Petitioner attends the annual meetings of the Board, which generally last several days and
include workshops, committee and panel discussions, and presentations on transportation issues.
Petitioner has participated in committee and panel discussions at these annual meetings.
Applicable law and regulations
Section 1101(d) of the Tax Law provides, in part:
When used in this article for purposes of the tax imposed under subdivision (f) of
section eleven hundred five, the following terms shall mean:
*

*

*

(6) Dues. Any dues or membership fee including any assessment, irrespective of
the purpose for which made, and any charges for social or sports privileges or facilities,

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except charges for sports privileges or facilities offered to members' guests which would
otherwise be exempt if paid directly by such guests.
*

*

*

(13) Social or athletic club. Any club or organization of which a material purpose
or activity is social or athletic.
Section 1105 of the Tax Law provides, in part:
Imposition of sales tax. On and after June first, nineteen hundred seventy-one,
there is hereby imposed and there shall be paid a tax . . . upon:
(a) The receipts from every retail sale of tangible personal property, except
as otherwise provided in this article.
*

*

*

(f)(2)(i) The dues paid to any social or athletic club in this state if the dues of an
active annual member, exclusive of the initiation fee, 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. Where the tax on dues applies to any such social or athletic club,
the tax shall be paid by all members, other than honorary members, thereof regardless of
the amount of their dues, and shall be paid on all dues or initiation fees for a period
commencing on or after August first, nineteen hundred sixty-five. . . .
Section 1105(c) of the Tax Law imposes tax upon the receipts from every sale, except for
resale, of certain enumerated services.
Section 527.11(b) of the Sales and Use Tax Regulations provides, in part:
(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 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.
*

*

*

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(6) Social club. A social club is any club or organization which has a material
purpose or activity of arranging periodic dances, dinners, meetings or other functions
affording its members an opportunity of congregating for social interrelationship.
*

*

*

(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.
Opinion
Affiliate benefits received for the payment of an annual fee to the Transportation
Research Board include several items relating to the Board’s mission. Such fee entitles
Petitioner to a number of benefits including use of the Transportation Research Board’s library, a
reduction in the registration fee for the Transportation Research Board annual meeting, receipt of
a complimentary subscription to TR News, eligibility to participate in the Transportation
Research Board subscription service, a discount on single copies of most publications of the
Transportation Research Board, including subscriptions to TRR Journal Online, and
announcements of the annual meeting and other professional conferences.
From the information submitted by Petitioner, the Transportation Research Board does
not appear to have a material purpose or activity of arranging periodic functions affording its
members an opportunity of congregating for social interrelationship, or the practice, participation
in or promotion of any sports or athletics. Therefore, the Transportation Research Board is not a
social or athletic club as contemplated in section 1101(d) of the Tax Law, and the fees paid to it
are not dues paid to a social or athletic club under section 1105(f) of the Tax Law. See section
527.11(b) of the Sales and Use Tax Regulations.
According to the information provided by Petitioner and the information appearing on the
Transportation Research Board’s Web site, affiliate fees paid by individuals to the
Transportation Research Board entitle the individuals to a variety of benefits including use of the
Board's library, discounts on the registration fee for the annual Board meeting and Board
publications, and announcements of the annual meeting and professional conferences. The fees
appear to be in the nature of membership fees paid by individuals to join and support a
professional organization that is not a social or athletic club under section 1105(f) of the Tax
Law. The fees do not appear to be a charge for tangible personal property taxable under section
1105(a) of the Tax Law or for a service taxable under section 1105(c) of the Tax Law. The Tax
Department has previously determined that membership fees paid to organizations that are not
social and athletic clubs entitling members to various benefits and services are not subject to the
tax imposed pursuant to section 1105(f) of the Tax Law. See Sea Tow Services International,
Inc., Adv Op Comm T&F, July 31, 2001, TSB-A-01(23)S. Accordingly, based on the facts

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submitted by Petitioner, annual fees paid to the Transportation Research Board by individual
affiliates are not subject to sales tax.

DATED: August 22, 2008

NOTE:

/s/
Jonathan Pessen
Tax Regulations Specialist IV
Taxpayer Guidance Division

An Advisory Opinion is issued at the request of a person or entity. It is
limited to the facts set forth therein and is binding on the Department only
with respect to the person or entity to whom it is issued and only if the
person or entity fully and accurately describes all relevant facts. An
Advisory Opinion is based on the law, regulations, and Department
policies in effect as of the date the Opinion is issued or for the specific
time period at issue in the Opinion.