A social or savings club is something that is beginning to take hold much more in this day and age. In the spirit of sharing funds, it is all about having a group of people come together for a common financial savings goal. With a social or savings club, people join forces to save towards a similar goal. They pool their money and contribute to the group savings plan. This savings plan can then work to take that money in a pooled environment and grow it through smart investments.
A social savings club is an organization within its own right. It needs to have a bank account to be able to hold all of the money the members contribute. On top of that, it has to report income earned on the funds to its members, who will then report it back on their individual tax returns. The social savings club since it is its own type of organization will fall under the requirement of needing an employer identification number.
A social savings club gets everyone together to contribute to the group savings plan. It is treated in the eyes of the Internal Revenue Service as to any other type or organization. Any of the interests that the saved funds earn needs to be passed down to the members, just like you would see from a partnership. With the membership agreement, you should have all the names of the members, their details as well as what they have saved to date to contribute to the larger sum of funds available to the group.