Business Sponsorship Turned Son's Motocross Activity Into Deductible Expenses for Dad.

The plaintiff's company sponsored the motocross activity of the plaintiff's son.  The son was a nationally recognized figure in motocross racing with numerous sponsors.  The plaintiff's business spent more than $150,000 to cover the son's motocross expenses, and the plaintiff's business did recognize additional activity as a result of the sponsorship.  IRS claimed that the business expenditures were nondeductible personal expenses, but the Tax Court disagreed.  The court noted that the plaintiff's business benefitted from the sponsorship, including the securing of a major source of financing.  The court also noted that the plaintiff's business was not the sole sponsor of the son's motocross activity and that the son had achieved national prominence before the plaintiff's business became a sponsor.  Evans v. Comr., T.C. Memo. 2014-237.

CALT does not provide legal advice. Any information provided on this website is not intended to be a substitute for legal services from a competent professional. CALT's work is supported by fee-based seminars and generous private gifts. Any opinions, findings, conclusions or recommendations expressed in the material contained on this website do not necessarily reflect the views of Iowa State University.

RSS​ Facebook Twitter