This from Golf World Magazine,
PGA Tour players can also rest easy knowing their tour has the ear of Capitol Hill. Most of us cannot touch our deferred income – IRA, 401(k) and the like – until we are 59 1/2 years old. But a tax bill passed in October 2004 grants an exemption for a plan “established or maintained by an organization incorporated on July 2, 1974.”
That date happens to coincide with the date when the PGA Tour was incorporated. What could the rationale for this special privilege? Is it economic hardship? Hardly. No matter how good the player, a current 25-year old player will expect to receive a deferred income from the PGA Tour of about $200,000 per year, regardless of how well they play. Receiving this for only 15 years, and waiting for age 52 at a mere 6 percent return, the special exemption allows them to access a middling $9.4 million. At a rate of 21 percent, that would be nearly $30 million.
Is it political rent seeking? Could be? But there really are so few PGA Tour players that it would be hard to see why Conrgesspeople would cater to them. But, it might have something to do with the billions of dollars in corporate relationships that depend on the success of the tour, including that of the television networks. But again, I cannot say.
Whatever the reason, should it not be alarming the way these Congressional actions are couched in secrecy? How about a tax exemption for all males born in NYC to Italian-Catholic mothers on the afternoon of August 12, 1974? Actually, more people may enjoy this privilege that the PGA Tour exemption allows! This is government of the people, by the people, for the people?
