Tax Reform Takes Aim at College Athletics

[GoYotes]

Current tax reform legislation could have a huge impact on the athletic budgets at all D1 schools. USD, like many schools, offers priority seating and other amenities in exchange for annual donations to the Howling Pack. The larger the donation the higher the priority and the greater the amenities. These donations are a huge part of the athletic budget.

Current tax law allows a deduction of 80% of these donations. The House and Senate have both passed tax reform legislation within the past month. There are numerous differences between the House and Senate versions which will have to be reconciled before the legislation can go to the President for his signature. However, both the House and the Senate version eliminate all deductions for these donations.

It is urgent that all fans of college sports contact senators (Thune & Rounds in SD) and representatives (Noem in SD) and convince them to remove this provision from the proposed tax legislation. Don't delay, contact them today.

[Cousin Eddie]

Dec 7, 2017 13:08:56 GMT -6 GoYotes said:

Current tax reform legislation could have a huge impact on the athletic budgets at all D1 schools. USD, like many schools, offers priority seating and other amenities in exchange for annual donations to the Howling Pack. The larger the donation the higher the priority and the greater the amenities. These donations are a huge part of the athletic budget.

Current tax law allows a deduction of 80% of these donations. The House and Senate have both passed tax reform legislation within the past month. There are numerous differences between the House and Senate versions which will have to be reconciled before the legislation can go to the President for his signature. However, both the House and the Senate version eliminate all deductions for these donations.

It is urgent that all fans of college sports contact senators (Thune & Rounds in SD) and representatives (Noem in SD) and convince them to remove this provision from the proposed tax legislation. Don't delay, contact them today.

Wait, so they eliminate deductions for charitable giving or just for gifts that provide some sort of return (like priority seating, access, etc.)?

[Yote 53]

From what I have read the spin meisters in the media are at work here. It's the Christmas season and saying that Republicans are eliminating charitable deductions is painting them as the devil. Makes for great headlines.

Charitable deductions are not going away. The spin is that if the standard deduction is doubled that more people will take the standard deduction and not itemize, which means the itemized deduction for charitable giving would not be enough to exceed the standard deduction. The entire premise of the thought process in this spin is that the ONLY reason people contribute to charity is for the tax deduction.

It's easier for me to cut and paste from an article I am reading:

For starters, while the deduction for charitable contributions is one of the few protected in the tax bill, fewer taxpayers would likely use it. That's because the standard deduction also would nearly double, meaning fewer households would itemize — which is the only way to take advantage of the deduction for charitable contributions.

So, the truth is that the charitable contribution deduction is actually being protected.

I freaking hate politics. I hate the spin meisters. I hate the twisting of words. I hate the pundits and politicians that use these issues to divide us just to get votes. I don't believe any of them anymore and don't trust the news anymore.

[GoYotes]

Perhaps I wasn't clear in my original post on this subject, but the only donations being targeted are the ones made to college athletic departments in exchange for which the payor receives the right to buy tickets, etc. (Cousin Eddie - it would be the amount described in Code Sec 170(l)(2)) In the case of USD it would be donations equal to the various membership levels in the Howling Pack brochure.

For example, the current Gold Club membership is $2,000. Under current tax law, 20% of this amount ($400) is deemed the value of the different benefits outlined in the membership brochure and no charitable contribution is allowed for that portion. However, you allowed a charitable donation for the balance of $1,600. Under both the Senate and House versions of the current tax legislation, none of the $2,000 would be deductible.

I debated starting this thread, because I was afraid that some would view it as political in nature. However, if you visit with anyone in athletic administration at USD or any other institution, this is a definite concern. Granted, no one donates to the Howling Pack just because of income tax considerations, but the tax deduction does make it more likely that an individual will donate more dollars than they would without the deduction.

[Yote 53]

That is more detail. Thanks for sharing.

If you had not noticed I do follow what is going on though I loathe it.

[Cousin Eddie]

Dec 7, 2017 16:56:26 GMT -6 GoYotes said:

Perhaps I wasn't clear in my original post on this subject, but the only donations being targeted are the ones made to college athletic departments in exchange for which the payor receives the right to buy tickets, etc. (Cousin Eddie - it would be the amount described in Code Sec 170(l)(2)) In the case of USD it would be donations equal to the various membership levels in the Howling Pack brochure.

For example, the current Gold Club membership is $2,000. Under current tax law, 20% of this amount ($400) is deemed the value of the different benefits outlined in the membership brochure and no charitable contribution is allowed for that portion. However, you allowed a charitable donation for the balance of $1,600. Under both the Senate and House versions of the current tax legislation, none of the $2,000 would be deductible.

I debated starting this thread, because I was afraid that some would view it as political in nature. However, if you visit with anyone in athletic administration at USD or any other institution, this is a definite concern. Granted, no one donates to the Howling Pack just because of income tax considerations, but the tax deduction does make it more likely that an individual will donate more dollars than they would without the deduction.

Thanks, GoYotes. That is exactly what I assumed you meant. That is frustrating. Without turning this isn’t a total political discussion, it is not unlike the plan to cut corporate tax, including for pass through entities, but then try to disallow this benefit in its application to attorneys, accountants and doctors. It is a reaction to a perception that these businesses make too much money, rather than having any basis in real fact.