Tax Implications of Participating in Reality Television

This instructional case is intended for use as a tax research project to introduce you to a “real‐world” issue that illustrates how statutes intended for one purpose are often used by tax advisors for seemingly unrelated purposes. The case is based on the ABC television show, Extreme Home Makeover: Home Edition, and the resulting tax treatment to the homeowners from the renovations provided by the show. This case allows you the opportunity to research a controversial tax issue that is currently undecided and asks you to assess the relevant authorities and determine whether the show's tax planning follows the intention of the law.