Tax Day is coming Tuesday, April 17th, but the planning for next year is already happening in earnest.
Due to the tax overhaul that was enacted for the 2018 tax year, there remain questions on its ultimate effect on golf from real estate holdings to country club memberships. How will the new laws, and tax deductions, influence the industry?
Golf Advisor has the answers so next year at this time you aren’t scrambling and reaching for the checkbook.
Perhaps the biggest effect on golfers will be business persons who do work on the course. The ability to deduct country club memberships and greens fees on your taxes is ending for 2018. Whether that is a consideration for the majority of golfers remains to be seen, but it is a hit in the pocketbook for the golf business consumer, and it may eventually hit the clubs.
The section of the law used for writing off golf expenses, the entertainment deduction, allowed writing off up to 50 percent of the expense. That is eliminated for 2018.
The elimination of the entertainment deduction, considering the role of golf in President Donald Trump’s life and a GOP Congress, shocked industry leaders. Dinners still qualify but entertainment won’t. More food, less play seems to be the answer.
“It just seemed counterintuitive,” Jay Karen told Golf Digest in January. “It’s a Republican Washington, D.C., and being inside golf, I knew golf was a legitimate business expense.”
Another big area of consideration is golf real estate.
The property tax deduction will be capped at $10,000 for all properties $750,000 and under, and that is bad news in the Northeast, but good news for golfing low tax hotbeds such as Hawaii, Alabama and South Carolina, which have lower property taxes.
Golf Advisor also answers the age-old question whether to rent or buy? The standard deduction is going to double next year and millions of taxpayers will no longer need to itemize, lowering the tax advantage of holding a mortgage and writing off the mortgage interest deduction.
Tax Day is coming soon, but the real changes are a year away. It’s best to be prepared. The best bet is to run your numbers again and have no surprises for next year.
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