It’s our first-ever #sportsball edition of the pod! Dig into the tax code a bit, and you’ll discover that tax-exemption and sports fit together like a sports reference and a podcast that doesn’t really cover sports. In other words... perfectly. From amateur athletics, to professional sports leagues, to this newish thing called NIL that allows collegiate athletes to get paid for the billions they earn other people, the IRS and tax law has something to say about all of it. And most importantly, after this episode you will too at your next summer cocktail outing...

Attorneys for this episode: Natalie Ossenfort, Tim Mooney, Victor Rivera

What are tax-exempt organizations?

Amateur athletics as 501(c)(3)s

Major pro leagues had 501(c)(6)s and then dropped them

·      Advocacy angle... weighing in on oversight is not lobbying, so many tax-exempt advocacy groups like Human Rights Watch have weighed in against the move.

·      Or, advocacy in support of (or opposition to) the “No Corporate Tax Exemption for Professional Sports Act”, legislation introduced in Congress in June of this year that, if passed, would strip the Tour of its tax-exempt status. ---> Lobbying

Case study: NIL Collectives as 501(c)(3)s

·      NCAA v Alston

·      NIL collectives were set up as 501(c)(3) organizations, making tax-deductible.

·      2023 IRS GLAM letter concluded that an organization that develops paid NIL opportunities for student-athletes will, in many cases, be operating for a substantial nonexempt purpose (ie, serving the private interests of the student-athletes, instead of providing a real charitable purpose).

Resources:

·      501(c)(3) exemption requirements by the IRS

·      Establishing your organization toolkit

·      GLAM letter on NIL Collectives

·      NCAA’s response to GLAM letter