Interesting story in the Washington Post:  Basketball Recruiting on the Nonprofit Margins: Tax-Deductible Donations From College Athletic Boosters to AAU Programs Are a Common Practice, by Eric Prisbell:

The funneling of cash recruiting inducements between colleges and AAU programs in the form of tax-deductible donations, usually made by college athletic boosters at the behest of a coach, has become common, according to 11 Division I head coaches and five AAU coaches, located throughout the country, interviewed for this story….

NCAA rules prohibit a college to pay, or arrange for its boosters or coaches to pay, any portion of a recruit’s expenses for any period before he enrolls in college. Donations to a recruit’s AAU team violate that prohibition, the NCAA ruled in a June 2005 decision involving Baylor University. An IRS spokesman declined to comment on whether the practice violated tax laws….

The Post identified 45 of the top AAU teams in the country and found that at least 30 were set up as nonprofits, according to IRS records. Because tax laws do not require nonprofits to identify their donors, almost all of them don’t, making documenting the frequency of the practice difficult. There’s no way of monitoring how the donations are spent. "In a lot of cases, these [players] don’t see any money," one AAU coach said. "Some of the good coaches will put it back into the program, some may keep it for themselves. There are guys who don’t have jobs. This is their full-time job."