posted September 25, 2001 12:02 PM
Where can I find out if sponsorship is tax deductible for the sponsor? I have been told by a couple of prospective sponsors that they would sponsor me but then they would be liable if their name was on my car, is this true where can I find out about these questions?
AJ GARBE70 Dirt Moderator
Total posts: 86
posted September 25, 2001 12:09 PM
they can file it and get there money back at the end of the year
c21 Dirt Roller
Total posts: 23
posted September 25, 2001 03:36 PM
As far a liabilty goes I don't know.
As far as the sponsorship being a deductable business expence I would say YES. I provide my sponsors with a reciept for "addvertising" (on my car) and then they send both me and the IRS a 1099 at the end of the year (sorry labman you've got to pay income tax on it, however $550 is a popular amount for beginning drivers to charge for associate sponsorships as no 1099 filing is required for annual payments that do not exceed $600). There are several books on this subject that mainly focus on the tax benifits of running your racing program as a real business. Check with Steve Smith books for a start (you may find the answer to your liability question as well). ...and always consult with a good accountant.