May 8, 2014, 11:59 AM EDT
The NBA calls its financial penalties “fines,” but they’re really forced charitable donations. They’re also, as Lamar Odom successfully argued to the IRS, business expenses.
You can bet Donald Sterling will try to write off his $2.5 million fine on his taxes.
On both the federal and state levels, lawmakers want to prevent that.
Any deduction is just not right, say six House Democrats. So they’ve introduced the Stop Penalizing Taxpayers for Sports Owner Fouls Act of 2014.
The bill, which would apply to fines since Jan. 1, says:
In the case of an individual who owns (directly or indirectly) a professional sports franchise, no deduction shall be allowed under sub- section (a) for any fine or similar penalty paid to the professional sports league or association of which the franchise is a member.’’.
This would apply to Sterling – and was obviously proposed with him in mind.
As unsympathetic as Sterling is, I just don’t believe this law would be constitutional. If passed – which I suspect is unlikely to happen anyway – the courts could deem it ex post facto. In other words, the law punishes for acts committed before the law passed, usually a method not allowed in the United States.
Plus, I don’t like further complicating an already far-too-complicated tax code with a specific rule that singles out sports owners. Why should sports owners have their own tax code? What makes them different than the rest of us? (Yes, I’m against stadium subsidies, too. Don’t fix that problem by creating another.)
California lawmakers are proposing something similar. Phil Willon of the Los Angeles Times:
Two state Assembly members from Los Angeles filed legislation Tuesday that would prevent sports team owners from writing off league fines as a business expense when they file their state income tax returns.
The bill was filed by Democratic Assemblymen Raul Bocanegra of Pacoima and Reggie Jones-Sawyer of Los Angeles.
“Donald Sterling’s outrageous comments and historic fine should not be rewarded with a multimillion-dollar tax refund,” said Bocanegra, who chairs the Revenue and Taxation Committee. “This fine is intended as a punishment; it should not be used as a tax loophole.
The specifics of this bill are not clear, but I have the same concerns stated above.
At least one politician, though, might be on the right track – actually using the Sterling situation to do good. Willon:
Meanwhile, Rep. Brad Sherman (D-Sherman Oaks) has asked city, state and federal regulators to “prioritize” inquiries into any allegations that Sterling’s companies engaged in racial discrimination against people who sought to rent apartments at the billionaire’s residential properties.
In a letter to the regulators, Sherman cited a payment of more than $2.7 million that Sterling made in 2009 to settle federal claims that he discriminated against tenants. Sherman’s letter did not say there were allegations pending against Sterling or his companies.
If there aren’t new allegations against Sterling, it would be difficult to do much now after he’s settled, but yeah, the government should definitely be further investigating Sterling’s alleged housing discrimination. While they’re at it, apply that level of scrutiny to everyone – not just the headline-inducing Sterling – suspected of housing discrimination. That actually matters.
Oct 25, 2014, 11:00 PM EDT
Reigning Rookie of the Year had offseason shoulder surgery, but may not miss many regular season games.
Oct 25, 2014, 9:30 PM EDT
Defending champs have no reason to exert themselves until the games count in the standings.
Oct 25, 2014, 8:00 PM EDT
Lopez hasn’t practiced since it was reported he suffered a soft tissue injury to his surgically repaired foot on Oct. 16.
Oct 25, 2014, 6:30 PM EDT
Warriors hold (almost) all the leverage, because Thompson will be a restricted free agent next summer.
Oct 25, 2014, 5:00 PM EDT
Oct 25, 2014, 3:30 PM EDT
Lineup data shows Green greatly improves his team’s chances when playing with the starters.
Oct 25, 2014, 2:00 PM EDT
Is Stephenson ready for responsibility that comes with going from Pacers to Hornets?
Oct 25, 2014, 12:30 PM EDT
No surprise, and Lakers fans feel the same way.
Oct 25, 2014, 11:00 AM EDT
It might be because short of an insane offer of a max deal, Thompson would rather take his chances as a restricted free agent next summer.
Oct 25, 2014, 9:30 AM EDT
Nice job of McCallum to stay active on a play where he had already missed a shot.
Oct 25, 2014, 8:00 AM EDT
Will Thomas make Kings regret choosing Darren Collison over him?
Oct 25, 2014, 12:01 AM EDT
Thunder will be very short-handed the first month of the regular season.
Oct 24, 2014, 11:00 PM EDT
It’s far from guaranteed that they will use it.
Oct 24, 2014, 10:00 PM EDT
And it was probably the smartest possible play
Oct 24, 2014, 9:00 PM EDT
76ers forwent any guaranteed salary to hit free agency sooner
Oct 24, 2014, 8:20 PM EDT
Bucks point guard Nate Wolters makes heads-up play
Oct 24, 2014, 7:31 PM EDT
Can’t say I ever pictured that.
Oct 24, 2014, 6:40 PM EDT
This is a minor trade, even in Sam Hinkie’s world.
Oct 24, 2014, 5:31 PM EDT
Clippers owner affirms reputation
Byron Scott says Lakers may need to trade for point guard. For now, Ronnie Price starts, Jeremy Lin off bench.
Oct 24, 2014, 4:41 PM EDT
Expect the Lakers to try and trade for a point guard… no, not Rajon Rondo.
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