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On March 31, 1998, the Devil Rays played its first major
league baseball game against the Detroit Tigers and lost the game
11 to 6. The Devil Rays apparently played all its scheduled
major league baseball games for 1998 on their scheduled dates.
In 1998, the partnership began incurring significant
additional expenses (that it had not incurred in prior years)
relating to its first season in major league baseball.
Substantially all the additional expenses relating directly to
the major league baseball games the Devil Rays played in 1998
were incurred in 1998 (e.g., player salaries, stadium rental, and
game-day operations).
For financial and tax purposes, the partnership maintains
its books and records on the accrual method of accounting.
On its financial books and records for 1995 and 1996, taking
into account yearend adjusting entries, the partnership treated
the deposits it received in 1995 and in 1996 on advance season
tickets and on private suite reservations as deferred revenue
(i.e., as liabilities, not as income).
On its Federal partnership tax returns for 1995 and 1996,
the partnership treated expenses relating to its minor league
baseball activities and to general operating and overhead costs
as current business expense deductions.4
4 The partnership did deduct on its 1995 and 1996 partnership
tax returns the current year annual interest expense relating to
the loan obtained to pay the $130 million franchise fee.
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Last modified: May 25, 2011