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UC Law SF Communications and Entertainment Journal

Abstract

Over the years professional sports teams have enjoyed special treatment under the law. In the mid-1970's, however, there was a general tightening of the tax treatment of sports teams. This note examines the Tax Reform Act of 1976 and recent court decisions which have tried to determine the proper allocation of cost to player contracts purchased with a sports franchise. Although no accurate method of allocating cost has yet been found, the author concludes that the court in Selig v. United States went too far in permitting significant amortization deductions for owners of baseball teams and that this extreme extension of the policy favoring baseball should be overturned on appeal.

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