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I am a homeschooling mother and Certified Public Accountant (CPA) combining my experience and knowledge to help homeschool organizations such as co-ops, support groups, music and sports programs. HomeschoolCPA answers questions from homeschool leaders on many topics such as nonprofit status, liability, paying teachers, tax exempt status and taxes.
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4:28 PM, Jun. 28, 2006
The IRS goes after Youth Soccer-Could homeschoolers be next?
(view similar articles on Non Profit Organizations)
The IRS is fining a nonprofit youth soccer league for back taxes because
"the association failed to withhold taxes for a dozen paid coaches and scores of referees in 2003 and 2004. The I.R.S. assessed the association $334,441 in back taxes and fines, an amount Mr. Skelton says will drive the nonprofit league out of business."
Here's the article NY Times Article
Could homeschool nonprofits that hire independent contractors (like an art teacher) be next? Maybe.
Mr. Skelton said that many of the league's skills coaches were employed by a Long Island soccer camp and defined under the contract as independent contractors. And many of the referees in the Fairfield case are older children officiating at the games of younger ones, for $20 to $40 a game.
"Are these 10-year-old children employees of Fairfield soccer? That's what we're facing," he said.
Does your child earn money helping out at soccer games? I know of several who do. What will the future hold? I'll keep you posted as I hear more...
Carol
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Why does the IRS insist in these kind of ridiculous, tyrannical actions? Does it have something to do with the fact that the soccer league has many fewer resources to fight them than does a corporation like, say, Enron? Could it be they go after the easy mark, like con men do, rather than the true tax cheaters simply beacause it is easier for the individual agents to fulfill their quotas?
Cynical Former Victim of the IRS,
Karen
Posted by Anonymous on Jun. 28, 2006 at 4:14 PM
Thanks for the info Carol!
That's too bad...I'm sure it will drive that league out of business.
Marsha
Posted by drewsfamilytx on Jun. 28, 2006 at 11:25 PM
The soccer league said that their revenues are about $400,000 a year, so a $330,000 fine would shut them down. But at the same time, they seem to have hired lawyers to fight the IRS auditor's assessment.
I was just at an IRS workshop for nonprofits and we discussed this case. The IRS agents shared quite openly about cases the IRS has lost, so we'll see how this one turns out. I kind of hope the soccer league fights for the principles here (i.e. difference between employees and independent contractors), because it will affect many yourth sports leagues and activities including homeschool co-ops that hire independent contractors.
Posted by HomeschoolCPA on Jun. 30, 2006 at 12:54 PM
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So Incredibly Ridiculous!
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