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Thread: NFL doesn't pay taxes??
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10-10-2013, 02:06 PM #1Hall Of Fame Poster
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NFL doesn't pay taxes??
Someone at work sent me a petition found on change.org to change the tax status of the NFL. I didn't know they were non profit. I must be living under a rock. Below are contents of the petition.
Despite the fact that it is a $9Billion/Year industry, the National Football League (NFL) continues to enjoy status as a non-profit organization -- meaning it doesn’t have to pay federal corporate taxes.
The Commissioner of the NFL, Roger Goodell, makes nearly $30 million a year -- earning more than the heads of companies like Coca-Cola and Wal-Mart. Through TV deals alone, the NFL has inked nearly $30 billion with various television networks. And so often, fans like you and me are asked to foot the bill for new stadiums through our own taxes.
Yet despite being the most profitable sports league in the entire world, the NFL does not pay federal taxes.
The NFL should pay their fair share towards our economy! Just like Major League Baseball, which gave up its nonprofit status in recent years, as well as the National Basketball Association, the NFL should not be able to hide under a nonprofit status in order to avoid paying federal taxes.
The NFL has methodically worked to shift all the power to their side, leaving players, employees and PARTICULARLY THE FANS little say in what goes on with the league. We deserve a say, but do not wish to boycott our teams! Therefore, we are calling on our elected representatives to revoke the tax-exempt status we bestowed upon the league half a century ago. Please sign this petition, and let Congress know that you want them to reconsider the NFL’s tax exempt status.
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10-10-2013, 02:12 PM #2Pro Bowl Poster
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Re: NFL doesn't pay taxes??
The individuals who receive salary - like Goodell pay both Federal, State and Local taxes on their income depending on where they live. So Goodell is paying at the top end on his Federal (about 40% - and if he is living in NY or NJ he's paying another 10+% in State.
So its not as dire as your post would suggest.
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10-10-2013, 02:16 PM #3
Re: NFL doesn't pay taxes??
So you actually believe he pays 40%? Hogwash. Doesn't matter what the rate is set at, the tax code provides him with many ways to get around the 40%. Like Exxon makes 40 bil and pays 2 or 3 %.
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10-10-2013, 02:58 PM #4Pro Bowl Poster
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Re: NFL doesn't pay taxes??
When you are talking about SALARY you are talking about ORDINARY INCOME. Other than giving it away to charity there is not really an easy way to shelter a SALARY of $30M.
If he had a $100 Million mortgage at 6% interest he could deduct $6M from the $30M. Even if he could SHELTER 90% of his SALARY he would still be in the 40% Federal Income tax bracket.
So yes I do believe that he is paying the top bracket rate (about 40%) on his adjusted gross income.
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10-10-2013, 03:32 PM #6Legendary RSR Poster
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Re: NFL doesn't pay taxes??
Nice job muddying the waters.
Corporate Taxes =/= Income Taxes
You best believe Goodell, just like anyone else at his tax bracket, is paying through the nose. There's very few shelters for individuals.
As for your claims that Exxon is paying 2-3%? Hogwash. Not even close.
http://www.usatoday.com/story/money/...taxes/1991313/
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10-10-2013, 03:49 PM #7On The Practice Squad
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Re: NFL doesn't pay taxes??
The fact that Goodell makes $30M per year to screw up the game is the scary part.
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10-10-2013, 03:53 PM #8Legendary RSR Poster
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10-10-2013, 02:16 PM #9Hall Of Fame Poster
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10-10-2013, 02:13 PM #10
Re: NFL doesn't pay taxes??
Next thing you know, the Gubment will be giving them subsidies, like Corporate farming and oil companies, so they can make even MORE money without paying taxes, and cut food stamps even more to come up with the money.
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10-10-2013, 02:20 PM #11Veteran Poster
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Re: NFL doesn't pay taxes??
The 'tax exempt' label is misleading. They're classified as tax-exempt, but that does not mean that they do not pay taxes. According to Forbes, they are classified as a 501c(6), not a 501c(3). 501c(3) is a traditional non-profit designation while the 501c(6) status covers "...business leagues, chambers of commerce, boards of trade, and similar organizations." The distinction here is that 501c(3) nonprofits (churches, etc) are single organizations that are not designed to make money, while 501c(6) organizations are an umbrella for members that ARE trying to make money--but for themselves, not the NFL as a whole.
Does that make sense?
The interesting conclusion to the article:
The NFL had expenses in excess of revenue of $77,628,857 for the year ended 3/31/2012 and $52,195,407 for the prior year. Apparently, that is nothing new. The liabilities of the NFL exceeded its assets by $316,642,454 at 3/31/2012. Superficially, my reasoning would be that if the NFL was organized as an LLC, instead of as an exempt organization, the member teams would have had nearly a third of a billion more in deductions since inception. I’m sure it is more complicated than that, but I suspect that the motivation for the way it operates may be to keep liabilities off the balance sheets of the member organizations. It appears to me that if there is a game there, it is a GAAP (generally accepted accounting principles) game, not a tax game.
Superficially, it appears that, if the NFL were not an exempt organization, it would not owe federal income taxes, because it has not been making money. If you view the NFL in conjunctions with its member teams, it appears that it has the effect of increasing aggregate taxable income.
So what is everybody so upset about ? Maybe somebody will explain it to meLast edited by goodandfast; 10-10-2013 at 02:24 PM. Reason: Added link
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10-10-2013, 02:25 PM #12
Re: NFL doesn't pay taxes??
The profits are earned by the individual teams that do pay taxes just as any other normal for-profit business does.
Whatever "the league" earns after payroll and other expenses is passed onto the teams (divided equally).
The league is not a for-profit business, it is a pass-through to the teams where taxes are paid.
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