Were triathlon athlete participation fees exempt when the organizer charged spectators taxable admission to controlled viewing areas?

Plain-English summary

The Florida Department of Revenue concluded that the triathlon organizer's athlete participation fees were not subject to sales tax while it charged taxable spectator admission to controlled viewing areas.

The races covered long public courses that could not be fully controlled. The organizer nevertheless sold access to sectioned-off spectator areas with viewing locations, hospitality, seating, and other benefits and collected admissions tax on those spectator fees.

That taxable spectator admission allowed the athletes' participation fees to qualify for the statutory exemption. The organizer separately paid sales or use tax on event goods given to participants.

What this means for you

Race and event organizers

Document the controlled spectator area, admission charge, tax collection, and separate athlete fee.

Participant-registration platforms

Keep third-party processing fees distinct from the participation fee remitted to the organizer.

Accountants and tax professionals

The exemption depended on continuing to collect tax on the spectator admission described in the ruling.

Common questions

Q: Were athlete entry fees taxable?
A: No, under the stated spectator-admission arrangement.

Q: Were controlled-area spectator fees taxable?
A: Yes.

Q: Did the organizer pay tax on participant giveaway items?
A: Yes.

Citations and references

• Fla. Stat. §§ 212.02, 212.04, 212.04(2)(a)9., and 213.22
• Fla. Admin. Code r. 12A-1.005(3)(j)

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 15A-018

Original ruling text

Executive Director
Marshall Stranburg

QUESTION: ARE THE PARTICIPATION FEES SUBJECT TO TAX WHEN THE TAXPAYER
COLLECTS SALES TAX ON THE SPECTATOR FEES IMPOSED FOR ADMISSION TO THE
CONTROLLED AREA AT AN EVENT?
ANSWER: AS PROVIDED IN SECTION 212.04(2)(A)9., F.S., AND RULE 12A-1.005(3)(J), F.A.C.,
THE PARTICIPATION FEES ARE NOT SUBJECT TO SALES TAX, SO LONG AS THE TAXPAYER
COLLECTS SALES TAX ON THE SPECTATOR FEES IMPOSED FOR ADMISSION TO THE
CONTROLLED AREA AT AN EVENT.
November 16, 2015
Re:

Technical Assistance Advisement – TAA 15A-018
Sales and Use Tax– Admissions
Sections 212.02 and 212.04, Florida Statutes (F.S.)
Rule 12A-1.005, Florida Administrative Code (F.A.C.)
XX (the Taxpayer)

Dear XX:
This is in response to your letter dated July 13, 2015, requesting this Department’s issuance of a Technical
Assistance Advisement (“TAA”) pursuant to section 213.22, F.S., and Rule Chapter 12-11, F.A.C.,
concerning the taxability of the “Participation Fees” described in your letter. An examination of your
letter has established you have complied with the statutory and regulatory requirements for issuance of a
TAA. Therefore, the Department is hereby granting your request for a TAA.
Facts
Your letter provides that following in part:
Taxpayer owns and operates triathlon events in Florida (each an “Event”) . . . . Athletes that wish
to participate in an Event (the “Participants”) pay an entry fee to Taxpayer (the “Participation
Fee”). To register for an Event, the Participant typically uses a third-party registration website . . .
where the Participant enters his or her information and secures a spot at the Event by paying the
Participation Fee. In addition to the Participation Fee, the Third-Party Website charges each
Participant a processing fee, which is retained by the Third-Party Website. The Third-Party
Website remits the Participation Fee to Taxpayer.
In . . . Event [A], the Participant engages in a 2.4 mile swim, a 112-mile bicycle ride, and a 26.2mile run (a full marathon). The Participation Fee provides the Participant with the following
benefits:
Child Support – Ann Coffin, Director  General Tax Administration – Maria Johnson, Director
Property Tax Oversight – Dr. Maurice Gogarty, Director  Information Services – Damu Kuttikrishnan, Director

http://dor.myflorida.com/dor/
Florida Department of Revenue
Tallahassee, Florida 32399-0100

Technical Assistance Advisement
Page 2 of 4

(a) A pre-Event banquet (a buffet style meal during which Taxpayer provides a briefing of the
course conditions);
(b) A post-Event banquet (a light breakfast during which awards are presented);
(c) Event-related goods ([Taxpayer]-branded backpack, shirt, medal, hat, and one other item, such
as an [Taxpayer]-branded license plate holder or flag); and
(d) Access to the “aid station” along the course route, where refreshments and quick snacks (such
as fruit or energy bars) are provided during the Event.
. . . Event [2] features a 1.2-mile swim, a 56-mile bicycle ride, and a 13.1 mile run. . . . Event [2]
is basically half the distances of the [the first described] Event. The Participation Fee provides the
Participant of this event with only a t-shirt, sling bag, finisher hat and medal. Florida sales or use
taxes, as applicable, are paid on the items purchased by Taxpayer and given to the Participants.
Given the vast length and varied terrain of the typical Event . . . , Taxpayer is unable to control the
entire course and charge all possible Event spectators (the “Spectators”) an entry fee. However, to
capitalize on the public’s interest in viewing an Event, Taxpayer has created a program, called the
XX, whereby it charges an entry fee to Spectators (the “Spectator Fee”). The [program] features a
sectioned-off area of the course (the “Controlled Area”) where only Spectators with a wristband
are able to enter. The [program] include items such as a catered lunch, a swimming-viewing area,
and a finish-line viewing area with a hospitality tent. . . . Taxpayer charges, and intends to
continue charging, Admissions Tax to Spectators on the Spectator Fee.

The following information regarding the “[Taxpayer] . . . program” is provided on the Taxpayer’s website
XX:
At the requests of the . . . athlete community, fans, and families, we developed the [Taxpayer] . . .
program. Focused on providing exclusive viewing areas and better vantage points to keep you
closer to the action and your athletes, the . . . program provides guests access, convenience, and
comfort. While the specific offerings vary with each unique event location and race venue, guests
can expect . . . shaded viewing & seating areas, hospitality, and around- the-clock assistance from
a . . . Staff Member to help with athlete tracking, event navigation, and supporting your athletes.

Requested Advisement
You request an advisement that addresses whether the Participation Fees are subject to tax when the
Taxpayer collects sales tax on the Spectator Fees imposed for admission to the controlled area at an Event.

Technical Assistance Advisement
Page 3 of 4

Applicable Authority and Discussion
Section 212.04, F.S., requires persons selling admissions to collect sales tax on the sales price or amount
received from admissions. The term “admissions” is defined by section 212.02(1), F.S., to mean and
include the net sum of money for admitting a person to any place of amusement, sport, or recreation, or
for the privilege of entering or staying in any place of amusement, sport, or recreation, including “races.”
Participation fees are subject to tax when the participant is granted entry to a place of amusement, sport,
entertainment, or recreation.
The sale of admissions is subject to tax unless specifically exempt. Section 212.04(2)(a)9., F.S., provides
a specific exemption for “[p]articipation or entry fees charged to participants in a game, race, or other
sport or recreational event.” The exemption applies in cases where spectators are charged a taxable
admission to the game, race, or other sport or recreational event.
Rule 12A-1.005 (3)(j), F.A.C., provides that a charge imposed “for the privilege of entering or engaging in
any kind of activity for which no admission charge is made to spectators are subject to tax.” However,
relying on the exemption provided in section 212.04(2)(a)9., F.S., the rule provides that participation fees
are exempt from the tax on admissions when spectators to the event are charged a taxable admission to
such event.
In this case, the Taxpayer charges the Participants an entry fee in order to participate in the Events. The
Taxpayer also charges an admission to allow Spectators into the Controlled Areas at the Events. The
exemption provided in section 212.04(2)(a)9., F.S., provides that the Participation fee is not subject to
sales tax when the Taxpayer charges sales tax on the Spectator fees. The cited exemption does not require
an analysis regarding possible other event spectators that are not charged an admission and do not enter
the VIP areas.
Conclusion
As provided in section 212.04(2)(a)9., F.S., and Rule 12A-1.005(3)(j), F.A.C., the Participation Fees are
not subject to sales tax, so long as the Taxpayer collects sales tax on the Spectator Fees imposed for
admission to the Controlled Area at an Event.
This response constitutes a Technical Assistance Advisement under section 213.22, F.S., which is binding
on the Department only under the facts and circumstances described in the request for this advice as
specified in section 213.22, F.S. Our response is predicated on those facts and the specific situation
summarized above. You are advised that subsequent statutory or administrative rule changes, or judicial
interpretations of the statutes or rules, upon which this advice is based, may subject similar future
transactions to a different treatment than that expressed in this response.
You are further advised that this response, your request and related backup documents are public records
under Chapter 119, F.S., and are subject to disclosure to the public under the conditions of section 213.22,

Technical Assistance Advisement
Page 4 of 4

F.S. Confidential information must be deleted before public disclosure. In an effort to protect
confidentiality, we request you provide the undersigned with an edited copy of your request for Technical
Assistance Advisement, the backup material, and this response, deleting names, addresses, and any other
details which might lead to identification of the taxpayer.
Your response should be received by the Department within 15 days of the date of this letter.
Sincerely,

Brinton Hevey
Tax Law Specialist
Technical Assistance and Dispute Resolution
850/717-6839
Record ID: 200649