If you give to Wichita State University athletics to help get prime seats, those donations soon may no longer be tax deductible.
Congress eliminated a deduction for donations to athletics funds made in connection to tickets as part of a massive tax code overhaul President Donald Trump signed Friday.
Under current law, those donations were 80 percent deductible, meaning you could deduct 80 percent of the value of the donation from your taxable income. The new tax code will entirely eliminate the deduction.
“At this time, we are reviewing all of the new information as there are still a lot of unknown factors in regards to the tax reform bill and how it will affect donations,” said Tami Cutler, a spokeswoman for Wichita State Athletics. “We are encouraging our supporters to consult their tax advisor.”
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At Wichita State, significant gifts to the Shocker Athletic Scholarship Organization make donors eligible to purchase certain numbers of men’s basketball tickets, according to the Shocker athletic scholarship website.
Those who contribute between $475 and $3,584 are eligible to purchase two tickets; those donating up to $7,019 are eligible for four tickets; donations up $9,919 make you eligible to purchase eight tickets.
And the numbers climb from there.
The athletic scholarship organization at Wichita State has received more than $5.5 million in donations this year, Cutler said. But it’s unclear what will happen going forward.
“With all of the unknown factors, we are currently waiting to see what kind of effect it will have on donations,” Cutler said.
The University of Kansas is in a similar situation. Chancellor Doug Girod told The Lawrence Journal-World last week that he doesn’t know how current donors will react.
“That’s the question, because right now they have a pretty reasonable incentive for donations they give, for example, to the Williams Fund for seats,” Girod said, referring to KU’s athletics fund.
Some university athletic departments across the country have been warning donors in recent days that the deduction may come to an end.
The athletics director at the University of Kentucky warned donors of the possible change in a recent email. At Baylor University, donors are being encouraged to consider giving before the end of the year to ensure receiving a deduction.
The elimination of the deduction is only a small part of the tax legislation passed by Congress on Wednesday. The entire Kansas congressional delegation supported the bill.
“The Senate passed historic, pro-growth #taxreform that is fair, simple and works for Kansas families and businesses,” Sen. Jerry Moran said on Twitter.
In broad strokes, the overhaul provides a deep cut in the corporate rate, from 35 percent to 21 percent. On the individual side, about 80 percent of American households will get tax cuts next year, while about 5 percent will pay more, according to the nonpartisan Tax Policy Center.
People who make less than $25,000 will see an average tax cut of $60; those who earn between $49,000 and $86,000 will get about $900, and those in the top 1 percent of income – earning more than $733,000 – will receive around $51,000 in tax savings, the policy center said.
The cuts will come at a price: The Congressional Budget Office predicts the legislation will add $1.4 trillion to the national debt over the next decade.
Contributing: the Associated Press