National Football League to voluntarily give up tax-exempt status

[babylonsister]

http://www.dailykos.com/story/2015/04/28/1380932/-National-Football-League-to-voluntarily-give-up-tax-exempt-status?detail=facebook_sf

Tue Apr 28, 2015 at 10:29 AM PDT
National Football League to voluntarily give up tax-exempt status

by Jen Hayden


Tired of the "distraction", the NFL is moving on.

Two years ago, we began to loudly question why the National Football League had a "non-profit" status. Daily Kos launched a petition gathered nearly 350,000 signatures and the story has continued to grow.

Today the NFL has made a surprising announcement:

In a letter to team owners, Commissioner Roger Goodell says the league office and its management council will file tax returns as taxable entities for the 2015 fiscal year. Goodell says the NFL has been tax-exempt since 1942, though all 32 teams pay taxes on their income.

Goodell says the change will not alter the function or operation of the league, since all the teams already pay taxes.

Some members of Congress have criticized the NFL, which generates billions in revenue, for being tax-exempt. Goodell says the status has become a "distraction."

Congrats to you, the Daily Kos readers who took action and kept up the pressure on Congress and the NFL.

[underpants]

1. Holy crap

Way to go Kos.

THAT was unexpected

[babylonsister]

2. No kidding-shocked, I tell ya! Churches next! nt

[underpants]

6. I wouldn't hold your breath on that one

Apparently the NFL is playing this off as a mere headache

[msanthrope]

3. nice political action by kos...nt

[roguevalley]

23. I heard that the guy who runs the league, what's his name will get his salary hidden from disclosure

[nadinbrzezinski]

4. Ok this is a surprise

given all the reading I have been doing on the economics of sport.

[rhett o rick]

5. I am not familar with this issue. If the teams already pay taxes, how will this decision impact

the NFL?

[underpants]

7. The NFL is a separate business entity

[BrotherIvan]

8. The NFL charges fees for other things

I worked on a film about a biographical story that featured a player and his team. The studio had to pay the NFL $75 million plus a share of the gross. Anywhere where an NFL team is mentioned has a fee. The fact that they may pay taxes on it is shocking.

[rhett o rick]

11. Doesn't seem they put up much of a fight. nm

[former9thward]

15. They already pay taxes on those.

"The fact is that the business of the NFL has never been tax exempt," Goodell wrote. "Every dollar of income generated through television rights fees, licensing agreements, sponsorships, ticket sales, and other means is earned by the 32 clubs and is taxable there."

http://espn.go.com/nfl/story/_/id/12780874/nfl-league-office-gives-tax-exempt-status

[BrotherIvan]

18. Ok, did not know that

[jeff47]

19. It has very little impact.

The NFL is mostly a pass-through to the teams, and all but one of those are taxed as for-profit companies. (The Packers are publicly-owned and non-profit)

[Recursion]

27. And the NFL had the "foresight" to keep the Green Bay model from happening again

Which is a shame

[Malraiders]

9. So the NFL will become another large corporation that doesn't pay taxes? n/t

[rhett o rick]

12. In fact they probably will follow GE's lead and get money back. nm

[progressoid]

10. They didn't do this without consulting a team of lawyers and accountants.

They'll make a couple payments to boost their PR image and then jump through a bunch of loopholes.

[Sgent]

17. There was never any tax advantage to them being non-profit

at most there were some advantages in terms of GAAP reporting (financial reporting to creditors, etc.) which may have made some team balance sheets look better especially if they were looking for stadium expansions, etc.

As a for profit enterprise:

Income
- Expenses
- Payments to owners of everything else
_________
No taxable income

As a non-profit:
Income
- Expenses
- Payments to owners of everything else
_____________
no taxes

http://www.forbes.com/sites/peterjreilly/2013/06/01/nfl-as-tax-exempt-less-than-meets-the-eye/

[hifiguy]

13. About damn time.

The NFL is a money-printing machine and should be paying taxes.

And I am a die-hard NFL fan.

[jeff47]

20. Not really. The league is just a pass-through.

Almost all of the money is sent to the teams. All but one team were taxed as for-profit corporations. (The Packers are non-profit)

This change will mean extremely little.

[hifiguy]

21. Maybe, but it's the principle of the thing.

[LittleBlue]

14. Finally. It is the biggest red herring issue the NFL has right now

The amount of cash flowing through the NFL entity is minimal. The NFL usually has a net loss anyway.

It will hardly contribute a single dime to the Treasury, nor will it have any financial impact on the NFl.

[former9thward]

16. This means they do not have to report salaries anymore.

There's also a benefit to the league's executives -- they no longer are obligated to publicly disclose their salaries. The league office in New York was required to disclose its filings because it was classified as a non-profit organization, which it no longer will be.

Goodell, who has earned an average of $18.8 million a year during his first eight years as commissioner, pulled in $44.2 million in 2012 and $35 million in 2013, according to the IRS filings.

http://espn.go.com/nfl/story/_/id/12780874/nfl-league-office-gives-tax-exempt-status

[hifiguy]

22. Roger Goodell is the most highly compensated errand boy

in the history of the universe.

[Recursion]

24. Does the actual NFL per se even make money to begin with?

I thought it operated at a loss?

[Angleae]

25. The NFL as an organization does not. The 32 franchises do.

[Recursion]

26. Right, that's what I had always thought

I mean, it just seems like a lot of people get very worked up over something that doesn't actually cost the government any tax money.