Do You Support A Sports Group?

Deduct the Cost of Sponsoring Sports Teams

This sort of sponsorship can be extraordinary PR for your organization and position you as a network disapproved of the resident. But what are the tax implications of becoming a team promoter? What are the relevant questions you’ll need to ask yourself?

For example, can you deduct your sponsorship of a sports team, even one you play on? And can you write off the costs of travel, umpires, uniforms, bats, and balls?

You’ll get conservative answers to essential questions.

Our fact-filled article can help you in three ways:

1. The position of Revenue Ruling 70-393.

The ruling states that the duties spent to outfit and support your team is similar to duties paid on other methods of advertising. This means you can deduct those sports teams’ costs as business expenses for federal income tax purposes.

2. The important Strong Construction case.

Strong Construction Co, Inc. paid for pants, bags, coats, sweatpants, T-shirts, hats, design, logo, and uniforms for all players on its sponsored teams. Also, Strong provided tournament and equipment fees. The court ruled that the expenses were “normal and necessary” business expenses that Strong could deduct.

3. How James Bower came out a winner?

Jim created the Lafayette Bower Housing Hustlers with a roster of twelve former Indiana college basketball players and an instructor. Bower was both an assistant instructor and a player. The court noted the Bower’s sponsorship increased his commodity brokerage business commissions and generated additional clients. As a result, his sponsorship expenses were deemed to be deductible business expenses.