Are charity poker tournament entry fees tax deductible?

[malcolmk14]

It doesn't seem to me like they should be.... but I've heard crazier things. Are charity poker tournament entry fees tax deductible?

[VladtheImpaler]

Originally Posted by malcolmk14

It doesn't seem to me like they should be.... but I've heard crazier things. Are charity poker tournament entry fees tax deductible?

No. Just like Hospital lottery tickets....

[GGG]

Shouldn't the percent that doesn't go to the prize pool be deductible?

[Locke]

Not in Canada as you cant deduct an expense against non-taxable income.

But, if you are registered as a Gambler in the USA (as a business) and the fees were for an American-held Tournament then theoretically yes, your entry fees would be deductible against your taxable winnings.

[Fire]

Originally Posted by GGG

Shouldn't the percent that doesn't go to the prize pool be deductible?

So if I buy $20 worth of 50/50 tickets at the Flames game, can I claim $10 as a donation on my taxes? That would make me feel better about buying 50/50 tickets.

[CorsiHockeyLeague]

Originally Posted by Locke

Not in Canada as you cant deduct an expense against non-taxable income.

If it's a charity tournament would there be any non-taxable income? For example the tourney I enter every year has an entry fee but you don't get anything if you win but pride. All the money from the entry fees goes to charity.

[Weitz]

These charity poker games rarely have cash prizes. Just things like tvs and such.

In fact I have never played one where you win cash.

[Jacks]

I've played in lots where you can win cash and the entry fee is not tax deductible. I did make the final table and win money a couple of years ago then donated the prize money back to the charity, I got a tax receipt for that donation.

[Slava]

Originally Posted by CorsiHockeyLeague

If it's a charity tournament would there be any non-taxable income? For example the tourney I enter every year has an entry fee but you don't get anything if you win but pride. All the money from the entry fees goes to charity.

Same with the one I play in and they send you a tax receipt for the donation/entry fee. Another one I play in doesn't however, so that one isn't a write off.

[malcolmk14]

Thanks everyone! I didn't think it would be, just thought I'd check!

[DoubleF]

I had to research this a little while back when I was working with a charity board. My understanding is that...

- It's not tax deductible personally if you don't have a donation receipt.

- It's possibly tax deductible if it's through a company, but you might have a hell of a time explaining a poker tourney if audited. Banquets/food are generally easier to explain.


Off topic (split receipting):

- The charity itself cannot offer a donation receipt in excess of the benefit received by the recipient. For instance, if an entry fee is $200 for a charity tournament and normal poker tournaments of a certain size are $150 FMV, then a person cannot receive more than $50 charity receipt. (Well, it can, but it risks losing it's charity status by doing that.) CRA also notes that if the FMV received is over 80% of the amount gifted, then CRA determines that there really isn't much intention to gift, and thus the charity shouldn't issue a receipt. Some charities give a donation receipt for the entire fee received. That's in excess of the FMV received.

http://www.cra-arc.gc.ca/chrts-gvng/.../splt-eng.html

This latter one I remember having to really push to get rid of donation receipts at the organization for certain events as they were concerned that bumping up the entrance fee cause people to balk. It just wasn't worth the risk for them to lose the charity number. The compromise was to issue invoices instead of charity receipt.

Some people will get upset and you'll lose their support because they don't get the donation slip, but if you're involved with a charity board, do you really want to be part of the board that ended up losing a charity number for the charity?

[MoneyGuy]

I'm not an accountant but I'd think they are deductible only if you do this professionally, but then you'd have to also declare your winnings. If you lose money for a few years then I'd expect they'd deny the deductions. If you don't do this professionally then it's not deductible. This being a charity event shouldn't change anything, I'd suspect.

[Slava]

Originally Posted by MoneyGuy

I'm not an accountant but I'd think they are deductible only if you do this professionally, but then you'd have to also declare your winnings. If you lose money for a few years then I'd expect they'd deny the deductions. If you don't do this professionally then it's not deductible. This being a charity event shouldn't change anything, I'd suspect.

Well if you get a receipt for a donation then you can deduct it. I obviously don't do this professionally (and this year it was completely a donation as I don't think I even won a hand )

[IamNotKenKing]

Originally Posted by malcolmk14

It doesn't seem to me like they should be.... but I've heard crazier things. Are charity poker tournament entry fees tax deductible?

Yes, if they give you a charity donation receipt.

[taxbuster]

Originally Posted by DoubleF

I had to research this a little while back when I was working with a charity board. My understanding is that...

- It's not tax deductible personally if you don't have a donation receipt.

- It's possibly tax deductible if it's through a company, but you might have a hell of a time explaining a poker tourney if audited. Banquets/food are generally easier to explain.


Off topic (split receipting):

- The charity itself cannot offer a donation receipt in excess of the benefit received by the recipient. For instance, if an entry fee is $200 for a charity tournament and normal poker tournaments of a certain size are $150 FMV, then a person cannot receive more than $50 charity receipt. (Well, it can, but it risks losing it's charity status by doing that.) CRA also notes that if the FMV received is over 80% of the amount gifted, then CRA determines that there really isn't much intention to gift, and thus the charity shouldn't issue a receipt. Some charities give a donation receipt for the entire fee received. That's in excess of the FMV received.

http://www.cra-arc.gc.ca/chrts-gvng/.../splt-eng.html

This latter one I remember having to really push to get rid of donation receipts at the organization for certain events as they were concerned that bumping up the entrance fee cause people to balk. It just wasn't worth the risk for them to lose the charity number. The compromise was to issue invoices instead of charity receipt.

Some people will get upset and you'll lose their support because they don't get the donation slip, but if you're involved with a charity board, do you really want to be part of the board that ended up losing a charity number for the charity?

A *lot* of charities will issue receipts for entry fees to tournaments. In general, when they get caught (eventually, they will) most will get spanked by CRA and told not to do it any more. The problem is that there is no determinable Fair Market Value (FMV) for the alleged "gift" provided. CRA is generally "nice" the first time; after that they are permitted to apply sanctions up to and including revocation.

When you provide (say) a new bike for auction, there is an absolute FMV for it, and that is determinable through a third party. Entry fees for tournaments are at the behest of the organizer. Potentially, if the entry fee were very large (say $1,000) and the biggest prize was of nominal value (say $50) an argument could be made that most of the entry fee was a gift. That would be a very rare circumstance in my experience.

Just because a charity issues a receipt doesn't make it "correct".....

It's one of the same reasons one can't donate "services"...no third-party FMV. So, when one wants to do that, charge for the services and donate the money back.

[DoubleF]

@taxbuster: In my situation, it was dinner banquets and a fun day on the golf course, not a poker tournament which is a bad example above for FMV. Golf fees/rental costs and meal costs were easily definable FMV numbers (organization paid costs).