The Tennis Masters Series Cincinnati tournament, where qualifying matches are under way, has more new this year than a telegenic color change to the courts. With the sale of exclusive commercial rights to one sponsor, the IRS could penalize Tennis for Charity Inc., the tax-exempt organization that runs this week's Tennis Masters tournament, and charge the group 34 percent on sponsorship revenue. ISL owns everything except the ticketing, hospitality and some on-site merchandising sales at the 10 Tennis Masters events. Currently, the firm has five global sponsors, a big reduction from about 200 corporate associations.
Sponsorship is no piddly portion of the tournament's revenue.
In the past, it has taken more than 60 percent of its revenue through corporate sponsorships, which include hospitality tents and advertising opportunities. Many high-profile sporting events, such as NCAA games, PGA tours and tennis championships are exempt organizations, placing their attention on the sport first, and charity second. To keep the series in Cincinnati, Mr. Flory and other tournaments signed on with the international marketing plan. This year, sponsorship revenue from ISL will be paid to Tennis Cincinnati Inc., a for-profit corporation, which will, in turn, put the money back into the tournament, eliminating the tax burden. The new sponsorship could make more money for the tourna ment, which could offer more support to charity.