Hi all,

During our last event, AIDS Walk Colorado, we had sponsors of the event and vendors at the event.  The sponsors are taken care of (gift - benefit = receipt amount), but how should we treat the vendors?  They basically get a space at the event and are free to promote their product/services.  We in no way endorse andy of the products or services.  Are the fees vendors pay for their spaces tax deductible? 

For the vendor, it is the cost of doing business, it should be coming out of their advertising budget. Because they are advertising/promoting their products or services they are not eligible to be sponsors for your event which would negate any 'donation' . I would check with your legal advisor to be sure because I am not a lawyer, but that is my thought on the matter.

I would say no.   They are purchasing vending space for that fee.  If in the future you set it up that they are "Sponsors" by donating to the race and a benefit of being a sponsor is getting a space and you takeout a potrtion of said donations as goods and services (the space to sell/promote) then part of their gift could be tax deductible.  But, if I am reading your questions correctly, you currently sell them the space, their fee would not be tax deductible.