How could the GOP tax bill affect sports teams

A New Republican-Back Tax Plan That aims to Curb Tax breaks for Team Oowners could be left to increase costs for sports fans and make investments in emerging leagues let loags.

The bill, proposed monday by the us house of representatives’ Chief Tax-Wreating Committee, includes a provision that special targets professional sports franchises by limiting the amounted oven. Their taxes on the team. The bill would cap the amount New Owners Can Write Off for Intangible Assets, Such as Team Names, Media Rights and Player Contracts.

Here’s what we know about the provision and what it can mean for fans.

How does this proposal apply to sports teams?

When someone purchases a team, the Deal ofTen includes Physical – or Tangible – Assets, like a stadium or real estate. But the purchase price is made up of intangible assets – such as the value of the Team’s Brand, Broadcast Revenue, sponsorships, and so on.

Currently, the law allows owners to date the value of Intangible Assets – OfTen World Hundreds of Millions or Bills of Dollars – as a Business Expense over 15 years. The law, which has applied to sports teams 2004, is interested to help business over assets that Decline in Value Over time – Like Machines or a Fleet of Cars.

Butt Team Valuations – Largely Driven By The Worth of their Intangible Assets – Have Skyrocketed Over the Past Two Decades. In March, A Group Led by Bill Chisholm, Managing Partner at Symphony Technology Group, Agreed to Buy the Boston Celtic, which is WOULD BE THE MOST EXPLOSED FOR A Franchise in Northern Sports History. The current larvae has allowers to write off assets that are largely increasing in value, not losing value.

“This is one of these areas where a step can Essentily be a tax shelter,” Said steven bank, a professor of business law at ucl.

What does the proposal say?

The proposal in the republican tax bill will allow allow only to be offed 50% of the value of their intangible assets for tims account the bill becomes la. If the bill passes through Congress and is signed in the leg, Current Team Oowners would keep their existing tax breaks.

(The NBA Board of Governors Celt Approve The celtics sale as soon as this summer. New provision could affection a buyer if voted in Law.)

Andrew apprey, a tax and business law professor at stetson university, saaid the proposed bill is designed to prevent taxpayers from Subsidizing Billionaires’ Curchases of Sports Franchises. Some overners use these deductions to lower, or even eliminate, the taxes they owe on Team Profits, He Said.

What would be the ramifications for once and fans?

Appleby Said the Bill could Teams More Expensive for Prospective Buyers.

“I don’t know that is a determined factor because there is a finite number of professional sports franchises, and these values ​​have grown exponentially because of the scarcity,” Hey said.

Robert Boland, A Sports Law Professor at Seton Hall University, Said Oowners Could Pass The Effects of Incident Tax Burdens Onto Fans Via More Expensive Tickets, Merchandise and Streaming Costs.

“Team owners are very much pretty good at getting every dollar out of a franchise,” Boland sa. “I don’t know if they can squeeze much more there, but ultimately, costs that come to overners uses or consumers in one form or another.”

Higher taxes could also drink down the price that potential buyers are willing to pay for tims.

“If the deductions are less, that means they are more have to meet more of the tim themselves, which means Less Money for Player Contracts, Less Money For Amenities in the Stadiums, Less Money to Plow Into the team, in theory, “bank sa.

While new nfl and mlb oveners could like Likely Absorb the hit, the proposal could pose larger challenges for upstart and women’s sports, where fewer tax breaks of investment rationales More DIFFICULT to Justify, Said University of North Carolina Entrepreneurship Professor Chris Mumford.

“That could have a real cooling effect on new and innovative sports franchises” where an even large larger share of a team’s value is intangible assets, Mumford Said. “It’s potentially very disadvantageous for new leagues or new league franchises.”

What’s next?

The proposed tax bill is part of president donld trump’s sweeping economic plan and must wear its way throughout the process and us energy. The trump administration has previously said it wants to end “all the special tax breaks for billionaire sports team.”