While the country is busy preparing their March Madness brackets, the fight over HB2 in North Carolina continues. As previously discussed on this blog, one impact HB2 had on North Carolina was the NCAA and ACC’s decision to remove several championship events away from the state. However, one North Carolina lawmaker has recently questioned whether the NCAA and ACC violated their tax-exempt status by moving sports championships outside of North Carolina.
According to the IRS, no 501(c)(3) organization may qualify for tax-exempt status if “a substantial part of its activities is attempting to influence legislation.” Such an “organization may engage, in some lobbying, but too much lobbying activity risks loss of tax-exempt status.” Mark Brody, a North Carolina House Republican, has stated that he believes the NCAA and ACC have “stepped out of bounds” and has announced his plan to file a bill to investigate the issue. If Brody’s bill, the Athletic Association Accountability Act, passes it would call for officials to determine if the NCAA engaged in excessive lobbying or political activities.