In 1992, when the San Diego Yacht Club won the America’s Cup, team captain Bill Koch said, “This is a triumph for America, for American technology, and American teamwork.” But the real triumph that year appeared on his personal income tax return, which included a $10 million charitable contribution toward that victory.
Funding for the whole team totaled $64 million, so not only did he get a deduction for that $10 million, but he also contributed another $44 million from foundations he controlled, which was presumably also a charitable deduction for him at some point. So why does Koch get to write off his incredibly expensive hobby and you can’t?
Fortunately for him, Section 170(c) of the Internal Revenue Code explicitly defines a charitable contribution to include organizations operated, “to foster national or international amateur sports competition,” which would include yachting. So while it may not seem fair, it’s 100% within the law. So maybe you just need to find a more expensive hobby.