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Taking a Sack: The NFL and Its Undeserved Tax-Exempt Status

Andrew B. Delaney

Though football teams and NFL-licensing entities are for-profit enterprises, the overseeing body is considered nonprofit. As such, it doesn't pay federal taxes. I also found out recently that the NFL doesn't pay New York state taxes either. It gets several million dollars from each of its 32 teams in the form of "dues and assessments"-- those are tax write-offs for the teams and tax-free income for the NFL. It's a pretty interesting little setup.

The NFL's stadium loan program is even more interesting. Under the G3 program, the NFL provides "loans"--and the quotes are indeed there for sarcasm--to teams that have entered into public-private partnerships with their home cities to build new stadiums. What is often touted as a "generous contribution" from the team is a mixture of financing structures that leaves very little coming from the team owner's pocket.

I have argued in an article that the NFL's abuse of its tax-exempt status requires that the NFL make the switch to for-profit status, as the MLB recently did. I did my best to make the piece amusing and lively. It's a work in progress, so suggestions are much appreciated. A full version of the article can be found at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1605281.

andrew@nationalsels.org.

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This page contains a single entry from the blog posted on May 19, 2010 12:55 PM.

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