If a Meetup.com group, a.k.a. a simple local community group, has a small fee on its events, and magically begins to accumulate tens of thousands of dollars, what laws are applicable to that income and the subsequent use of it? It's neither a business or an individual, technically...

The money is all deposited in the Meetup account via Paypal transactions. This is all in the United States.

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    Who controls it, who collects it, who holds it, who spends it? Any chance the group is formally incorporated or certified under state law? Or is this really a question about meetup.com policies and you are just asking what WOULD happen? – NL7 Apr 28 '14 at 20:47
  • Who is depositing the money? Or does it just stay cash? Because whoever/whatever deposits the cash will likely be the one on the hook for taxes – Jack Sinclair Apr 28 '14 at 20:58
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    Paypal to whose name? That guy is going to see a 1099 if the amount exceeds $600/yr. And he better have the paper trail to account for it. – JTP - Apologise to Monica Apr 28 '14 at 22:00
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    For which tax jurisdiction? – ChrisInEdmonton Apr 28 '14 at 22:01
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    @JoeTaxpayer I don't believe the $600/yr 1099-MISC applies in this case, since PayPal doesn't "employ" or pay the payees, they just move money around. As far as I know, you have to have $20,000+ in volume from 200+ transactions in the calendar year before PayPal will report income / issue documents, and that will be a 1099-K, and that's all bound under IRS Section 6050W – Noah May 6 '14 at 15:44

In the United States tax law, a group of people who are neither an individual nor an incorporated entity is called "partnership".

Here's the IRS page on partnerships.

Income derived by such a "meetup.com" group is essentially a partnership income with the group members being the partners.

However, as you can see from the questions in the comments, the situation can become significantly more complex if this partnership is not managed properly.

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