26 CFR §1.501(c)(5)-1

1. (a)The organizations contemplated by section 501(c)(5) as entitled to exemption from income taxation are those which:
   1. (1)Have no net earnings inuring to the benefit of any member, and
   2. (2)Have as their objects the betterment of the conditions of those engaged in such pursuits, the improvement of the grade of their products, and the development of a higher degree of efficiency in their respective occupations.
2. (b)
   1. (1)General rule. An organization is not an organization described in section 501(c)(5) if the principal activity of the organization is to receive, hold, invest, disburse or otherwise manage funds associated with savings or investment plans or programs, including pension or other retirement savings plans or programs.
   2. (2)Exception. Paragraph (b)(1) of this section shall not apply to an organization which—
      1. (i)Is established and maintained by another labor organization described in section 501(c)(5) (determined without regard to this paragraph (b)(2));
      2. (ii)Is not directly or indirectly established or maintained in whole or in part by one or more—
         1. (A)Employers;
         2. (B)Governments or agencies or instrumentalities thereof; or
         3. (C)Government controlled entities;
      3. (iii)Is funded by membership dues from members of the labor organization described in this paragraph (b)(2) and earnings thereon; and
      4. (iv)Has not at any time after September 2, 1974 (the date of enactment of the Employee Retirement Income Security Act of 1974, Pub. L. 93-406, 88 Stat. 829) provided for, permitted or accepted employer contributions.
   3. (3)Example. The principles of this paragraph (b) are illustrated by the following example:
3. (c)Organizations described in section 501(c)(5) and otherwise exempt from tax under section 501(a) are taxable upon their unrelated business taxable income. See part II (section 511 and following), subchapter F, chapter 1 of the Code, and the regulations thereunder.