[Snorlax94]

Can someone explain to me how the IRS allows any portion of the money that MUST be paid, and is publicly documented as required, in order to receive a particular product to be considered tax deductible at any non-zero rate?  Especially if that "donation" requirement is seemingly widespread in the industry and not a trivial amount.

Why doesn't the state consider this part of the purchase price and tax it accordingly?  For that matter, why doesn't the state or federal attorney general's office consider this practice to be a conspiracy to avoid taxes.

This is a common practice for non-profits. It's how many fundraise. For example, if a person purchases a table at a charity dinner for $2,500, they get a table with 10 seats for dinner. $500 of that money ($50 dinner x 10 people) is not-deductible, it's considered a donation in anticipation of a gift received, but the other $2,000 is deductible. Now, the more you or a company donates ($5,000 a table, $10,000 a table) you get a better table (more centered, closer to the speaker), but it's still only $500 that is non-deductible for the food. So the $25,000 table is like sitting on the 50-yard-line,where $24,500 is tax-deductible and $500 is not deductible because of the food.

If you donate like $250 to a film festival, you might get 2 tickets to a gala, 4 free tickets, and not have to pay any ticket processing fees, so maybe only $100 of the $250 is tax-deductible.

I don't think what Athletic Depts are doing is out-of-line with the general practice.

[Snorlax94]

Can someone explain to me how the IRS allows any portion of the money that MUST be paid, and is publicly documented as required, in order to receive a particular product to be considered tax deductible at any non-zero rate?  Especially if that "donation" requirement is seemingly widespread in the industry and not a trivial amount.

Why doesn't the state consider this part of the purchase price and tax it accordingly?  For that matter, why doesn't the state or federal attorney general's office consider this practice to be a conspiracy to avoid taxes.

This is a common practice for non-profits. It's how many fundraise. For example, if a person purchases a table at a charity dinner for $2,500, they get a table with 10 seats for dinner. $500 of that money ($50 dinner x 10 people) is not-deductible, it's considered a donation in anticipation of a gift received, but the other $2,000 is deductible. Now, the more you or a company donates ($5,000 a table, $10,000 a table) you get a better table (more centered, closer to the speaker), but it's still only $500 that is non-deductible for the food. So the $25,000 table is like sitting on the 50-yard-line,where $24,500 is tax-deductible and $500 is not deductible because of the food.

If you donate like $250 to a film festival, you might get 2 tickets to a gala, 4 free tickets, and not have to pay any ticket processing fees, so maybe only $100 of the $250 is tax-deductible.

I don't think what Athletic Depts are doing is out-of-line with the general practice.