Friday, January 18, 2013

Are Members of CIB Paying Income Tax on Free Suite Tickets They Receive for Colts' Games?

An Indianapolis City-County Council Committee recently considered the issue of raising the car rental tax by 50% and the ticket admissions tax by 67%.  Councilor Brian Mahern dared to ask the question that councilors should have been asking all along - who is getting free tickets from the Capital Improvement Board to events and are they paying the admissions tax.   One would think that the public would have the right to know who locally is receiving free tickets to sporting events, especially since local public officials never have any problem giving away tax dollars to billionaire sports owners.  Still many councilors were outraged that Mahern had the temerity to ask an obvious and much needed question.

Ann Lathrop, president of the Capital Improvement Board, did finally admit that each member of the CIB receives two free suite tickets to Colts tickets and they don't pay the admissions tax on the tickets.

My next question would be are the members of the CIB paying individual income tax on the free tickets they receive?  Yes, they certainly do have to pay tax on those tickets.  A brief research in the topic suggests the suite tickets to an NFL game are worth about $500 apiece.  That's $1,000 a game, or $8,000 a year.  Five years on the board, that would be $40,000 of taxable income just on Colts games. That is not even counting free tickets they receive to other events as well, including Pacers games.


Flogger said...

I wonder how many Councilors and City Officials receive "free tickets"

Jon said...

Taxes are just for the little people you can't expect city councilors and mayors to abide by the law, we are the law.

Indy Rob said...

how much money is lost by not taxing just pro football tickets in Federal taxes?

8 home games per team, 32 teams, 256 regular season games per year.

From 2012 Team Marketing Report, average premium ticket is $243.70 .

Assuming that each team provides 50 tickets per game to city councilmen and mayors (this may be low, Chicago alone has 50 alderman) and that the marginal tax rate on these tickets is 15%, it works out that these free tickets (256 * 50 * 243.70) * 15% leave about $500,000 in uncollected taxes (about $900,000 at 28%). Oh, darn, I left out any state, local or fica taxes.

Seems that congress should look at the non-profit status of the NFL, and determine if the NFL should be issuing 1099's for the value of the tickets.