Monday, May 11, 2015
The NFL - No Longer Tax Exempt
You may be asking, "The National Football League was considered a Tax Exempt organization?" Well yes it was, up until now. The NFL has voluntarily given up their 501 (C) (6) tax exempt status. 501 (C) (6) entities are different then the 501 (C) (3) charities you find rated on Charity Navigator's website. 501 (C) (6) status covers business leagues, chambers of commerce and other similar entities, such as professional sports leagues. Income from their industry-promoting activities is exempt from federal taxation.
The move to relinquish this status has been explained by the league as a means to end distractions and misunderstandings about the tax status of the $10-billion a year organization. Politicians and some others see it as an opportunity for other professional sports leagues to follow suit and to "return millions of dollars to the federal treasury." It should be noted that NFL teams themselves are not tax exempt and do pay taxes on their earnings. What this change truly means to incoming tax revenue is unclear, but one result is that the NFL will no longer have to disclose the salaries of league officers. Major League Baseball gave up its tax exempt status in 2007, but the PGA Tour and National Hockey League remain tax exempt.