Admissions to University Basketball Games Not Taxable in Connecticut

Monday, September 16th, 2013

 
 
Share
Link
Connecticut
General

The Connecticut Department of Revenue Services (Department) recently ruled that admissions to a university's basketball games were exempt.

Connecticut generally taxes admissions to places of amusement, including spectator sports events. However, Connecticut exempts admissions to an event if all the proceeds from the event go exclusively to an entity that is exempt from federal income tax. That entity must actively engage in and assume the financial risk associated with presenting the event.

Here, a university had an agreement with a venue to use that venue for the university's basketball games. The university was exempt from federal income tax. The university was responsible, at its own expense, for presenting the basketball games, maintaining and paying for worker's compensation insurance, paying relevant taxes and the local fee on admissions charges, and advertising and marketing the games. The venue sold tickets to the games. From the box office receipts, the venue took the amount the university owed it for rent and other charges. If the receipts were not enough to pay these charges, the university paid the deficiency. If there were any proceeds left after payments to the venue, the university was entitled to receive them. In practice, however, the games did not make enough money for the university to receive proceeds from them.

The Department held that the admissions were exempt because the university (1) was exempt from federal income tax, (2) actively engaged in presenting the games, and (2) assumed the financial risk from presenting the games. The university "actively engaged" by presenting the games, paying relevant taxes and fees, and advertising the games. Because the university did this at its own expense and because any potential proceeds would go to the university, the university assumed the financial risk. It did not matter that, in practice, the university did not receive proceeds from the games. Admissions to the university's basketball games were therefore exempt.

http://www.ct.gov/drs/cwp/view.asp?A=1513&Q=531494


About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

New York Adopts New Economic Nexus Rule

Wednesday, January 23rd, 2019 -Effective January 2019, a retailer located outside of New York is required to collect use tax if, during the p...

New Commercial Farmer Certification Process in Louisiana

Monday, January 21st, 2019 -Effective January, 15, 2019, the Louisiana Department of Revenue has a new certification process for commercia...

Service Repairs to Petroleum Storage Tanks Exempt in...

Friday, January 18th, 2019 -Louisiana's Board of Tax Appeals recently ruled that repairs on petroleum storage tanks were not taxable. ...

Nevada Exempts Feminine Hygiene Products in 2019

Wednesday, January 16th, 2019 -Last year, Nevada voters approved via ballot measure changes to the Sales and Use Tax Act of 1955. Voters amen...

Cleaning of Beer-Tap Lines Not Taxable in Ohio

Monday, January 14th, 2019 -The Supreme Court of Ohio recently ruled that cleaning beer-tap lines is not taxable. The taxpayer was...

Louisiana Court of Appeals Finds Marketplace Facilitators...

Friday, January 11th, 2019 -The Louisiana Court of Appeals has recently addressed the sales tax liability of marketplace facilitators. A c...