Counsel David Shechtman and associate Matthew J. Meltzer co-authored an article for the Journal of Taxation of Investments exploring IRS Revenue Procedure 2019-18 and its impact as a “safe harbor” under which sports franchises may value player contracts (including draft picks) acquired in a trade at “zero value” for determining gain or loss under the general principles of Section 1001.

In the article “The IRS Been “Berry, Berry Good” to Baseball and Other Sports Team Owners in Taxing Player Contract Trades,” Shechtman and Meltzer review existing guidance for determining adjusted basis in a player contract, including the amortization rules under Section 167 and Section 197; the implications of Rev. Proc. 2019-18; and the limitations on using the “zero value” safe harbor.
Source: Journal of Taxation of Investments
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