Lamar Odom, the 6- foot-10 Los Angeles Lakers forward, is challenging his IRS bill, arguing that certain expenses he deducted are related to his work as a professional athlete and therefore are “ordinary and necessary expenses” paid in carrying on a trade or business which are deducible. Specifically, Odom sought to deduct expenses associated with fines handed down from the National Basketball Association (NBA). Odom also claimed expenses incurred in training and conditioning arguing that his contract with the Lakers requires him to be in sufficient physical condition. The IRS views these expenses as personal, rather than business expenses, and therefore not deductible.
The fines for which Odom is arguing should be deducible are not excluded from the regulations pertaining to the deductibility of fines and penalties. See Reg. 1.162-21. Therefore, this case likely turn on whether these expenses are truly personal in nature, or incurred in connection with Odom’s “trade” as a professional athlete.
Forbes, Lamar Odom Seeks Tax Deduction For NBA Fines and Fitness Fees