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  • 1.  Casino Night Chips - Value on Receipt

    Posted 05-15-2023 11:20 AM

    Hi, Everyone! I have a Casino Night Sponsor Question:

    We have a campus partner running a casino night. Per Colorado law, our partner is not allowing any sort of prize winnings, the games are for fun only. However, while reviewing their brochures, the sponsorship levels listed the below:

    Gold Sponsor: $1,500
    1. Recognition in booklet
    2. Dinner for 4 ($400)
    3. $2,000 Poker Chips
    Total Benefits Value $400

    I am concerned that providing a value for the poker chips (Especially one that is higher than the gift) establishes additional goods and services for the gift. I am also concerned that this negates any gift, as it makes the donation a game of chance, although there are no winnings from participating. If someone were to give us the above sponsorship, would we have to reduce the full amount of the poker chips?

    Also - if the campus partner were to adjust the langue to: "50 red chips" would that resolve this?



    ------------------------------
    Hillary Cote
    Fort Lewis College
    hlcote@fortlewis.edu
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  • 2.  RE: Casino Night Chips - Value on Receipt

    Posted 05-15-2023 11:45 AM
    While there are no winnings, if you still have to buy chips to play, then those chips have an equal fair market value. Therefore, I do not see any charitable gift amount.

    John

    John H. Taylor 
    919.816.5903 (Cell/Text)

    Big Ideas; Small Keyboard



    Original Message


  • 3.  RE: Casino Night Chips - Value on Receipt

    Posted 05-15-2023 12:24 PM

    Thanks, appreciate your advice!



    ------------------------------
    Hillary Cote
    Fort Lewis College
    hlcote@fortlewis.edu
    ------------------------------

    Original Message


  • 4.  RE: Casino Night Chips - Value on Receipt

    Posted 05-15-2023 01:05 PM
    Hi Hillary,

    I take a different view
    I think the chips provide a $0 FMV, because the only value they have is providing you with a better chance of winning a tournament that has no economic benefit. It doesn't matter whether you call them 50 red chips, $2,000 in chips, or 10,000 galactic credits - the name doesn't create any value. 

    You might suggest that maybe they have some value in the sense that they provide admission to the game itself. But if we look at the marketplace and ask what people are willing to pay to be admitted to a no-money poker game, the answer appears to be $0. There aren't businesses who provide such an offering in person. Online, poker for no money is free. You could maybe find a comp with board game cafes, that rent tables and access to their library for $5/day, but even that is overstating the value. You can play any game from the library for $5, not just poker. Whether you fall out at $0 or at $5, it's still certainly not an FMV of the chip value.

     I also don't see how this would create a game of chance. You can't win anything, which is definitionally required to be concerned about this. 




    Thank you,
    Isaac Shalev
    Data Strategy Expert
    Sage70, Inc.
    (917) 859-0151
    isaac@sage70.com

    Schedule a 30-minute consultation now:




    Original Message


  • 5.  RE: Casino Night Chips - Value on Receipt

    Posted 05-15-2023 01:10 PM
    I was looking at this from a "pay-to-play" perspective. Key factors in determining the tax deductibility of a gift are that the payment must be made voluntarily and that you do not receive anything in return. In this case, you have no choice but to pay to get a chip - and the payment is giving you that chip.

    I definitely see this as a proceeds-to-benefit activity. But I think it is a stretch to consider these voluntary payments receiving nothing in return.

    John

    John H. Taylor
    Principal
    John H. Taylor Consulting, LLC
    2604 Sevier St.
    Durham, NC   27705
    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987





    Original Message


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