The new tax bill and college athletics

BioJacket06

BioJacket06

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http://www.sportingnews.com/ncaa-fo...l-basketball-trump/1xib0mbmqidzx19sl9zqk2g3yx

The high-dollar world of big-time college football and basketball is going to get even pricier because of the new tax bill that cleared Congress on Friday and will be sent on to be signed by President Donald Trump.

Case in point: The 21 percent excise tax, mandated by the bill, means, for example, that new Texas A&M football coach Jimbo Fisher's $75 million contract actually will cost the university $90.75 million, The Athletic reported.



The bill requires that non-profit organizations, such as universities, pay the excise tax on any employee who makes above $1 million or the top five highest-paid employees, even if their compensation doesn't exceed six figures.

Because college football and basketball coaches typically are among the highest-paid employees at NCAA Division I schools, this will have a widespread impact on universities.

As another example, expect Alabama to have to pay an extra $1.2 million per year on top of football coach Nick Saban's $7.125 million annual income, USA Today reported.

The impact doesn't stop there, however. The new bill also changes the past tax code that made donors' financial gifts to athletic departments, tied to purchasing season tickets, tax deductible.

Tom McMillen, president and CEO of the LEAD1 Association, told USA Today that the monetary impact of the new bill is astronomical.

“This is going to cost hundreds of millions of dollars a year,” McMillen said. “It’s literally half a College Football Playoff (in terms of money worth). When you put it at that kind of magnitude, it wakes you up a little bit.”

USA Today reported that 90 head or assistant coaches in just football made more than $1 million. While not all of those coaches are the top-five highest-paid employees at their universities, the mass effect that programs will face paying out these taxes for football alone will be huge.
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RE: Excise Tax impact - sounds like the factories are having to pay millions more, don't see a problem there from a "Tech fan" perspective, but I recognize it may not be that simple.
 
I believe the tax bill also rescinded the write off of up to 80% of the seat license. That is bound to have some impact on revenues for colleges.
 
Right. The whole seat license thing was a way for the school to gouge the consumer. The consumer complied since it was largely deductible and half off so to speak. Thats gone. It will reveal a school for what it is. Rip offs.

Now the consumer can choose to still pay it. Drop it. Or the school depending on reaction cuts back the seat license costs, eliminates them thereby making gameday more affordable.

If a school keeps the fees as is and people still pay thats good business. Supply demand. Capitalism

If a school keeps a fee as is and ticket sales drop a school will have to consider lowering or doing it differently which is good for the consumer ultimately

The knee jerk reaction would be to say this hurts the fan. And it can in spots. But this will now also put pressure on schools to reprice tickets cheaper and fund raise the old fashion way through unrestricted donations. Which in the end will help the fan as big donations become obsolete for seats and point systems are back in trend. And with these unrestricted donations based on points it is still tax deductible so the fan nets out the same or better. Tech going back to the AT fund points system would be welcoming.

It will be interesting to see how schools react now with what will become a way overpriced ticket and if over time it helps the fans or not.

For me this is a bit of a no news topic. Donations to schools are still deductible. This is about removing the dangling carrot of seats as a mean to gain revenue. And doing it based on classic donations. It probably ends up being 6 one way half dozen the other in the end once the dust settles
 
gogt5 said:
Sell beer, get a new coach that loves recruiting, and win some damn games
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I hope it forces the University presidents to act and tell the NFL that they will no longer be a defacto developmental league and that the NFL owners should implement a farm system.

Only true STUDENT-Athletes will be allowed to play NCAA. No more non qualifiers accepted.
 
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