#1 Shaun is a huge college football fan. In the past, he has always bought footb
ID: 2398688 • Letter: #
Question
#1
Shaun is a huge college football fan. In the past, he has always bought football tickets on the street from ticket scalpers for his alma mater's football games. This year he decided to join the university's ticket program, which requires a $2000 contribution to the university for the "right" to purchase tickets. Shaun will then pay $400 per season ticket. Shaun understands that the price paid for the season tickets is not tax deductible as a charitable contribution. However, he has heard that contributions to a university are typically tax deductible.
Use your research skills, to determine, how much, if any, of Shaun's $2000 contribution for the right to purchase tickets is tax deductible.
Assume it is for Shaun's 2017 tax return and give your answer to Shaun in terms of what percent of the $2000 is deductible such as 10, 20, 30, 100 etc.
#2 Shaun is a huge college football fan. In the past, he has always bought football tickets on the street from ticket scalpers for his alma mater's football games. This year he decided to join the university's ticket program, which requires a $2000 contribution to the university for the "right" to purchase tickets. Shaun will then pay $400 per season ticket. Shaun understands that the price paid for the season tickets is not tax deductible as a charitable contribution. However, he has heard that contributions to a university are typically tax deductible. What would you advise Shaun if the date was now 2018 and the Tax Cut and Jobs Act had just passed into law.
As in question #1, give your answer to Shaun as a whole number which represents a percent of the of the $2000 that is deductible such as 0, 10, 20, 30 etc.
Explanation / Answer
Part 1
Under the rules for 2017, Shaun would be elegible to deduct 80% of the contribution as deduction.
Part 2
Deduction would be 80% of $ 2000 = $ 1600
However, in the new The Tax Cuts and Jobs Act the same provision has been removed and nothing will be elegible for deduciton.
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