SMU Law Review


Abstract for SMU Article - Promoting Health with Sports - April 1 2015 Current law routinely denies tax benefits to organizations promoting recreational adult sports even though medical research associates our inactivity with an epidemic of chronic diseases causing human suffering and spiraling healthcare costs. The IRS routinely grants tax-exempt status under IRC § 501(c)(3) to youth and college sports organizations based on century-old thinking that links sports with education. This obsession with evaluating sports as education developed in a bygone age when sports were merely for students and the idle rich, and most adults got plenty of physical activity at work. As recently as 1960, fifty percent of all jobs required at least moderate physical activity. By 2006, that figure had plummeted to twenty percent, and the average U.S. male age 40 to 50 was 32 pounds heavier than his counterpart in 1960. Over this same time span, there has been a dramatic increase in chronic diseases associated with inactivity. Scientists say that greater physical activity and improved diet are the ways to fight this epidemic. The IRS’s view that sports must be educational to justify tax benefits can be traced to a 1904 court opinion espousing the view that education involves the cultivation of the mind, the improvement of religious or moral sentiments, and the development of one’s physical faculties. The court’s foundation was that “those in charge of colleges . . . recognize this to be true,” and colleges encourage “football and other athletic sports.” Even in 1904, these factual assertions were dubious. U.S. college presidents, chancellors and other had mixed views about the role of athletics on campus even in 1904, and no other country’s education system embraces college sports on the U.S. scale. In 1945, the same appeals court rejected the 1904 three-part education theory and concluded that if an institution’s athletic activities greatly exceed its mental activities, the organization is not educational. Nevertheless, the IRS clings to the outmoded view that sports organizations must be educational to be worthy of tax benefits. This Article endorses even older, but forgotten, judicial precedents that recognized sports organizations as tax-exempt because they promote health. This would support tax benefits for organizations promoting adult recreational sports. This could encourage major shifts in the U.S. approach to sports. We could progress from an excessive emphasis on youth and college sports, to encouraging everyone to compete, and from huge number of spectators and few players, to greater participation by all.

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