NFL No Longer Tax Exempt, No More Bludgeoning Roger Goodell With His Yearly Salary
By Ty Duffy
The NFL has revoked its claim to tax exempt status. Loud noises! Fireworks! What does this mean? Probably not that much.
It sounds like a much bigger deal than it is. This does not save the NFL a tremendous amount of money by being tax exempt. The league is classified as a trade association. The vast majority of the revenue goes through the teams and is taxed. The net savings from this tax exempt status was estimated to be about $10.9m per year over the last 10 years. That is less than the cap hit for 45 individual players in 2015.
Because it’s not that much money, in NFL terms, the tax exempt status is not worth a protracted fight to defend it (an effort that likely would have been futile if challenged). With the NFL far more of an inviting public target than it once was, that could have involved congressional investigations, Roger Goodell getting called into testify, congressmen ranting about the NFL’s various sins etc. Not the “distraction” the NFL wants.
The move may not cost the NFL anything. With the league not tax-exempt, teams can deduct their team membership dues as business expenses. Those membership dues make up most of the league’s revenue.
Another benefit: the NFL no longer needs to file public, non-profit disclosure forms. This means it no longer has to disclose executive salaries. So, we don’t find out how much Roger Goodell made in a given year, a significant bludgeon during the media’s semi-annual performance evaluations.
[Photo via USAT]