Welcome to the newest edition of The Why. “Why is the NFL tax exempt?” you ask? Good question . . . timely too. (Besides, it beats answering the question: “Why does my little brother think things he pulls out of his nose are edible?”)
Readers familiar with the earlier ALW works of yours truly know that this subject might be new for some reporters but we here at ALW already covered it many months ago. In truth, the National Football League’s tax exempt status has been an issue since some time prior to Super Bowl 2014.
Mind you, the huge profits the NFL makes on merchandise, royalties, ticket sales and TV contracts might have been enough to get a petition and some legislation brought up again but surprisingly many folks may still have been clueless that the NFL which reportedly takes in approximately $10 billion every year enjoys a tax-exempt status. Apparently, all the recent controversy caused by NFL practices has inspired politicians to once again get involved.
Which is undoubtedly why we now hear the question: Why is the NFL tax exempt? Why is the NFL special?
After all, the National Basketball Association has always been a for-profit business. Major League Baseball gave up the status back in 2007 because of changes to the code regarding the “required disclosure of executive salaries.”
The National Hockey League and The Professional Golfers Association may also be non-profit trade organizations but they do not rake in nearly as much money as the NFL does. They also tend to avoid near daily controversy a h*lluva lot better than the NFL. So why is the NFL (still) tax exempt?
According to sources such as SF Gate: “The NFL league office has been a tax-exempt 501(c)6 trade association since the 1940s.” They are still a tax exempt organization due in part to lobbyists. “In 1966, the Section 501(c)(6) was amended following the AFL-NFL merger to include professional football leagues.”
Many believe the NFL will remain that way too. They (ironically) can afford a lot of expensive lawyers and lobbyists to keep it that way. Plus, if the NFL had their status revoked some fear that would lead to the NHL and PGA losing their status as well and they don’t rake in as much money. Thus, it is feared by some legislators that this could have a serious negative impact on the world of hockey and golf.
Why is the NFL tax exempt? Now you know.
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