Tax Reform Affects Donations

November 3, 2017

Last Thursday, Republicans in the House of Representatives introduced a 76-page tax reform bill that has many sweeping changes. A smaller provision that affects athletic departments is the elimination of the tax deductible status on donations made for season tickets. According to the McClatchy DC Bureau, the rule change is one of many that eliminates deductions in order to pay for tax cuts.

At the NCAA Divison I level, many schools require those wishing to purchase season tickets in prime locations to first donate to the athletic program. Those donations are currently tax deductible up to 80 percent (although the tickets themselves are not).

Rob Spear, Athletic Director at the University of Idaho, said 50 percent of his school's donations are the result of “seat backs,” donations that come with the right to purchase season tickets. He said most donors give out of love of their school or a desire to give back, but the tax deductibility can serve as an extra incentive.

“When you get in front of that prospective donor and you lay out the tax deduction, sometimes it seals the deal,” Spear said. “Schools that have lived by increasing seat back prices will see significant changes ahead.”

George Holding, a Republican representative from North Carolina on the Ways and Means Committee, helped write the bill. He argued that the changes would have wide-reaching benefits.

“I went to Wake Forest. We’ve got a great field house out there,” Holding said. “Rams Club, the Wolfpack Club, all these things are a big deal. But at the end of the day, aren’t you willing to give up all these little tax preferences in exchange for not only a lower rate, but a growing economy?”

 

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