A couple of things to add:

As others have pointed out the tax savings example you provide is unrealistic. You won't reap a greater tax benefit than your contribution. Also, not sure how you’d be in a 55% or 52% bracket even combining federal and state tax rates. However, you stated earlier that you were more focused on the workings of the collective than the tax aspects so let's move on from there.

Some may have heard that the IRS has increased its scrutiny of these collectives. That is true and it advised in an Office of Chief Counsel memorandum last May that in many cases the NILs will not be furthering an exempt purpose under 501(c)(3). Their reasoning is beyond the scope of this post (and yes they do address the involvement of charitable organizations the way the Every True Tiger collective is organized).

Now, should donors worry about this? Not currently because the Every True Tiger collective has (per their website) received a determination letter granting them 501(c)(3) status. As such contributions should be deductible by donors unless and until the IRS notifies the public that contributions to the organization are no longer deductible.

Should that ever come to pass however, donors could simply make future contributions to the University Tiger Scholarship Fund’s Tiger Branding Fund which is organized with the same objective in mind.

So in summary, as you point out, all fans have the opportunity to support MU’s NIL effort and receive a tax deduction in the process thus subsidizing their contribution. So please do!

This post was edited on 12/6/23 at 11:51 am