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Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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Im a practicing attorney and I sponsor a mens softball team.

Resolved Question:

I'm a practicing attorney and I sponsor a men's softball team. My firm (one person S Corp) spends several thousand dollars per year on equipment and entrance fees. In return, my firm name is XXXXX XXXXX the back of our uniforms and anywhere else I can get to. I just took the whole team to a tournament in Las Vegas and my accountant is hesitant to allow my corp to deduct the $10,000 of travel expenses the team incurred. I agree that it's not a charitable contribution, but can't I get an advertising deduction for it?

Chuck Motl [email protected]
Submitted: 6 years ago.
Category: Tax
Expert:  Merlo replied 6 years ago.

Hello Chas,


There is nothing absolutely definitive in the IRS code which spells out exactly what expenses you may deduct for business purposes. However, the IRS is very clear about the fact that in order to be deducted as a business expense, the expense must be something that is "ordinary and necessary" in your line of work. While a few hundred dollars for sponoring a softball team and buying their shirts may be allowed as a ordinary business expense, I would agree 100% with your accountant that deducting $10,000 for travel expenses for the team would not be considered ordinary or necessary.


It is one thing to pay for shirts that advertise your law firm's name, but to pay $10,000 for the team's travel expenses is not related to any advertising expense.


You can certainly claim the deduction, but if you were to be audited I would say with almost 100% certainty that the IRS would disallow this deduction.


If this was helpful please press the Accept button.


Thank you Chas




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