Partner Carl Fortner was quoted in a Tax Notes Today article, “IRS Could Balk at Guidance for Valuing Pro Sports Trades,” about a new requirement that professional sports franchises put fair market values on their players’ contracts for trade purposes.
Fortner said providing guidance on the new requirement to pro sports franchises may be a low priority to the IRS, which he said has “bigger issues that affect more taxpayers and with greater amounts” that require guidance. He said the IRS will likely tell franchises that the new requirement is like any other valuation issue.
Teams aren’t just faced with the challenge of valuing the contracts of existing players, Fortner added, but also with figuring out the value of draft picks. “That’s a more difficult issue for me to conceptualize,” he said. “I would think those rights have some value.”