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I had no idea the NFL was tax exempt

Discussion in 'Sports Forum' started by Revmitchell, Dec 7, 2013.

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  1. Revmitchell

    Revmitchell Well-Known Member
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    The NFL’s tax-exempt status is, as the refs might say, “under further review.”

    Despite having grown over the decades into an estimated $9 billion-a-year operation, the NFL retains a non-profit status, just like trade associations and chambers of commerce.

    The status, dating back to the 1960s, was granted to help the once-fledgling operation get started and applies only to the league’s so-called “front office” -- which is run like a non-profit in that it collects dues from its 32 teams to pay for such operational costs as referees’ salaries, the college draft and executive paychecks.

    But critics argue that hugely profitable sports enterprises -- including those that frequently strong-arm taxpayers into financing their multi-million dollar stadiums -- should get no such benefit.

    The lone Capitol Hill lawmaker pushing for the change is Oklahoma Republican Sen. Tom Coburn, a fiscal hawk whose annual “waste-book” draws attention to the NFL exemption and millions of dollars in other potential government waste.

    http://www.foxnews.com/politics/201...tus-demand-for-state-and-local-money-rankles/
     
    #1 Revmitchell, Dec 7, 2013
  2. thisnumbersdisconnected

    thisnumbersdisconnected New Member

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    Tom Coburn means well, but he doesn't have the facts. Every dollar of income that is earned in the National Football League –- from game tickets, television rights fees, jersey sales and national sponsorships –- is subject to tax. None of this income is shielded in a tax-exempt entity. Instead, the NFL’s 32 clubs pay tax on all of these revenues.

    Claims that the NFL is using a tax exemption to avoid paying the tax due on these revenues are simply misinformed. The confusion arises from the fact that there is one small part of the NFL, unrelated to all this business activity, that is tax-exempt: the NFL League Office. The league office is the administrative and organizational arm of the NFL and does things like write the rules of the game, hire referees, run the college draft, negotiate the collective bargaining agreement with the players, conduct player safety research, and run youth football programs.

    The league office acts as a trade association for the NFL clubs. In the same way that other trade associations support companies in other lines of business – it establishes rules and standard practices for its members, develops programs to help them run their operations more efficiently and profitably, and promotes the business in the broader community. Trade associations are nonprofit organizations. They don’t engage in any business activity. As a result, they are exempt from being taxed under section 501(c)(6) of the federal tax code. Charities are exempt under section 501(c)(3). The NFL League Office has never claimed to be a charity.
     
    #2 thisnumbersdisconnected, Dec 7, 2013
  3. Revmitchell

    Revmitchell Well-Known Member
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    There is no good reason for them to be tax exempt.
     
    #3 Revmitchell, Dec 7, 2013
  4. InTheLight

    InTheLight Well-Known Member
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    The irony. Revmitchell is calling for more taxes! Yikes! :)

    (BTW, good explanation by TND.)
     
    #4 InTheLight, Dec 7, 2013
  5. Salty

    Salty 20,000 Posts Club
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    The NFL should be tax exempt as football season is a religion :smilewinkgrin:
     
    #5 Salty, Dec 7, 2013
  6. thisnumbersdisconnected

    thisnumbersdisconnected New Member

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    Every trade association in the country is tax exempt. That's the only part of the NFL that is tax exempt, is the portion of it having to do with the plying of the league's trade. That part of the NFL's income is miniscule. As I pointed out, the pro shop income, merchandizing, etc., is all taxable, and the teams and the league pay taxes on them.

    If you're going to insist on the the NFL's trade activities being non-tax exempt, you'll have to champion all the other trade associations also losing their tax exempt status. It's nitpicking. Waste of time. The money raised would be next to nothing, whereas the league and its teams are already paying huge taxes on their merchandise.
     
    #6 thisnumbersdisconnected, Dec 8, 2013
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