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Examples of Nonqualifying Activities - Labor Organization

The following examples illustrate activities not furthering the exempt purposes of a labor organization under Code section 501(c)(5).  If non-qualifying activities are an organization's principal activity, the organization may lose its exempt status.

  • Providing employment to members through a business activity.
  • An organization, created by an association of manufacturers and a labor union, that collected and paid to government agencies employment taxes.
  • A savings plan established pursuant to a collective bargaining agreement.
  • A strike fund controlled by private individuals who controlled the organization that paid benefits to workers.
  • An organization whose principal activity is managing funds associated with savings or investment plans or programs, including pension or other retirement plans.



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Page Last Reviewed or Updated: 30-Oct-2013