"My uncle does not dance."
Translation:मेरे फूफा नाचते नहीं हैं।
Retaining or dropping the है does not change the meaning of the sentence.
'My uncle does not dance' may be written as either 'मेरे फूफा नहीं नाचते हैं' or 'मेरे फूफा नहीं नाचते' because the हैं is optional in most negative sentences with नहीं. You can also write मेरे फूफा नाचते नहीं हैं like the suggested translation which emphasises the negation but the हैं is usually not dropped when using this word order.
'My uncle is not dancing' would be मेरे फूफा नाच नहीं रहे हैं (or'मेरे फूफा नाच नहीं रहे' with the dropped हैं).