Tennessee: Professional Membership Dues Not Subject to Sales Tax

The Tennessee Department of Revenue recently addressed whether dues paid for memberships to a professional organization were subject to sales and use tax when a member received certain taxable items as part of the membership. The taxpayer’s membership fee granted members access to certifications, resources, tools, academic research, publications, professional development courses, and networking opportunities. Under Tennessee law, professional memberships are not an enumerated taxable service or amusement. While the members at issue received a variety of nontaxable items, they were also granted access to e-learning courses and on-demand webinars that would be taxable on a standalone basis. However, the Department determined that the taxable benefits provided were not essential to the membership sales, and members did not necessarily take advantage of them. In the Department’s view, the taxable items received by members were incidental to the sale of the memberships and did not result in the memberships becoming taxable. For more information on Letter Ruling #21-02 please contact Justin Stringfield at (615) 248-5510.