PGA Tour still tax-exempt, with an assist from Nicklaus
KAPALUA, Hawaii (AP) — On the day PGA Tour Commissioner Jay Monahan announced more than $180 million given to charities last year, he shared how the tour turned to Jack Nicklaus to help protect golf’s model for raising money.
The tax-exempt status of the PGA Tour and other sports leagues was in jeopardy late last year under the Tax Cuts and Jobs Act. Part of the Senate version of the bill included a subsection called, “Repeal of Tax-Exempt Status for Professional Sports Leagues.”
That’s when Monahan decided to call Nicklaus at his office, but he dialed his mobile phone.
“He whispers, ‘Hello?’” Monahan said Sunday at the Sentry Tournament of Champions. “I said, ‘I need your help.’ I walked him through the whole scenario. I said, ‘I need you to make some phone calls and write some letters. We need to go full bore on this thing.’”
Nicklaus whispered because he was in a field in upstate New York. He told the commissioner he’d get started when he got back to Florida.
Monahan said Nicklaus wrote letters and called senators. Meanwhile, Davis Love III went up to Washington a week after having hip surgery and helped arrange for meetings with members of the Senate Finance Committee.
Golf Digest reported in December that PGA of America chief executive Pete Bevacqua said he contacted his political contacts. Ultimately, the provision was not in the final version of the Senate bill.
“It’s pretty amazing that Jack Nicklaus and Davis Love III were reaching out to their congressmen and women,” Monahan said.
If the provision had remained in the bill, it could have required the PGA Tour to change its structure in a way that would reduce tax incentives to attract corporate support that makes charitable giving possible. All net proceeds from PGA Tour events go to local charities, and corporate support helps pay bills from prize money to operational costs.
Monahan said the $180 million that PGA Tour events generated last year broke last year’s record by about $14 million. That includes donations from tournaments on all six of its tours — PGA, Champions, Web.com, Canada, Latin America and China.
PGA Tour events have raised $2.65 billion dating to a $10,000 donation from the Palm Beach Invitational in 1938.
“It’s a big part of who we are,” Monahan said. “We like to think we do it better than anyone else. It’s our scorecard, if you will.”