The university owes almost $100,000 to the Internal Revenue Service after an audit found it wasn’t paying taxes on Adidas freebies given to staffers.
Source: U of L To Pay Back Taxes On Adidas Swag, Club Memberships
According to this report from 89.3 WFPL the University of Louisville has to consider adidas apparel given to staff and faculty as income and they have to treat it as taxable which means they owe 96,000 dollars for apparel given to athletic department staff members.
Now, I don’t know about you, but in my head this opens the door for a lot of issues and quite frankly it appears to be a bit excessive in regard to an institution of education.
adidas pays the college, the college is taxed on that income. The items they receive are a part of the agreement with adidas. When the college gets gear they should be free to give that gear to anyone they like within the laws of the NCAA. Isn’t being taxed for giving a coach some gear that has already been taxed, redundant?
I’m not clear on this, but this is a strange one to me. There is a copy of the report on the source link and more info for you to see if you get a better understanding than I have. Leave a comment to let me know.
Roughly $200,000 worth of Cards clothing — polos, workout gear and the like — handed out to coaches is a fringe benefit and taxable, according to the IRS audit of the university’s wages in 2014 and 2015. Since the clothing is not required for work and can easily be worn off the clock, U of L should’ve been considering the fair market value of the clothes to be gross income subject to tax, the audit said.
The IRS found that U of L also neglected to treat as taxable income golf club dues for four employees, worth about $25,000 a year.
