Sponsorship questions - Auto Racing Forum

GVP Racing · 04-22-2012, 03:21 PM

I have always heard that sponsorship is a tax deduction but how is it deducted

757 · 04-22-2012, 04:44 PM

Usually a business can write it off as an advertising cost. Obviously theres more to it than just that, but thats how they do it.

Jacob29 · 04-22-2012, 08:34 PM

On the personal side, there is a rule for hobbies in the tax code. If you get sponsored, you just spend that sponsorship and its a wash, you dont pay taxes on the "income".

As a business, any moneys you spend on sponsorships can be considered advertising (like 757 said), and all advertising expense is tax deductible.

04-22-2012, 03:21 PM	#1
GVP Racing Bar Stool Racing Sophomore Join Date: Apr 2009 Location: Thornton Colorado Age: 20 Posts: 15 Rep Power: 213	Sponsorship questions I have always heard that sponsorship is a tax deduction but how is it deducted

04-22-2012, 04:44 PM	#2
757 Hall of Fame Member (silver level) Join Date: Nov 2008 Location: Pueblo CO Age: 26 Posts: 502 Rep Power: 284	Usually a business can write it off as an advertising cost. Obviously theres more to it than just that, but thats how they do it. __________________ I-25 Hornet #49

04-22-2012, 08:34 PM	#3
Jacob29 Hall of Fame Member (gold level) Join Date: Jun 2006 Location: Firestone Age: 33 Posts: 778 Rep Power: 439	On the personal side, there is a rule for hobbies in the tax code. If you get sponsored, you just spend that sponsorship and its a wash, you dont pay taxes on the "income". As a business, any moneys you spend on sponsorships can be considered advertising (like 757 said), and all advertising expense is tax deductible. __________________ http://www.primalracing.com Jacob Fehler - 1st American Insurance Agent - Send me a PM - I can insure almost anything, including Racecars.

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