NFL is tax exempt

Mr. Obvious wrote:

Willow Wisp wrote:

Non-profits generally can not pay their top execs million dollar salaries.

And, yes. I hold the rich in complete contempt. They are sociopaths

Some non-profits can. it is a complicated and murky area of tax law.

Can you name some other non-profits than pay their CEO $30million in a year?

What difference does it make how much the CEO of a tax exempt organization makes? That has absolutely nothing to do with whether or not the organization should be tax exempt. The people who are the decision makers for the entity decide the value of the particular CEO or Executive Director.

His base salary was actually $3.1 million. The year before, he took home roughly $10 million in total so I am not sure if the $30 million included a one time bonus (because of the NFL contract settlement in 2011 which he may have been paid a bonus in 2012 after the season - but this is just a guess) or there were other factors that will make the compensation more continuous or higher in the future.

By the way, there is a good chance that no other CEO or Executive Director of a tax exempt organization makes that much. But as I said, who cares? It's not a factor in determining whether an organization is tax exempt.

Sure they can if they have the revenue. For example here is a list of the top 10 chicago nonprofit hospital ceo payhttp://www.chicagobusiness.com/Assets/legacy/downloads/20130422HighestPaidHospitalCEOs.htmThat is just chicago and just hospitals. Performing art directors at JFK, MOMA and the like all bring in the big bucks and so do the heads of large charities like ACS. Nonprofits are big business. It helps a lot when you don't have to share the money with shareholders.

Willow Wisp wrote:

Non-profits generally can not pay their top execs million dollar salaries.

And, yes. I hold the rich in complete contempt. They are sociopaths

Know the Definitions wrote:

What difference does it make how much the CEO of a tax exempt organization makes? That has absolutely nothing to do with whether or not the organization should be tax exempt.

What does allow an organization to be tax exempt? What logical reason is there that the NFL should be tax exempt?

By the way, there is a good chance that no other CEO or Executive Director of a tax exempt organization makes that much. But as I said, who cares? It's not a factor in determining whether an organization is tax exempt.

Repeat. What is?

The CEO at the nonprofit I was working at was making salary decisions with a mindset that hurt the company. For example, he was out to prove to his competitor that he didn't need money to be better AND almost an entitlement to get things for free because it is a nonprofit. That everyone should feel grateful for the organization to even choose to let you in the inner circle.

Any decision that involved an expenditure was made with that attitude. There was no sense of fairness. Why should we pay a fair tip? They get our business!

Then the CEO was the only one who had a salary you could get by on in this city. Any person who asked for anything fair would be told, "Why do you deserve to make more than me." Market rates based on salary history were thrown out of the discussion because he would turn it around to you not proving that you are worth that while working in the organization.

I've done a lot of negotiations. This wasn't a negotiation. There is no sense of fairness, no common ground or respect. Employees are seen as disposable if they don't follow exactly what he says. The scary part is that he seems to get a kick out of knowing that you are living in a highly risky financial situation because it gives him power.

Klondike5 wrote:

Know the Definitions wrote:

What difference does it make how much the CEO of a tax exempt organization makes? That has absolutely nothing to do with whether or not the organization should be tax exempt.

What does allow an organization to be tax exempt? What logical reason is there that the NFL should be tax exempt?

By the way, there is a good chance that no other CEO or Executive Director of a tax exempt organization makes that much. But as I said, who cares? It's not a factor in determining whether an organization is tax exempt.

Repeat. What is?

Klondike - first learn how to quote because the 2nd paragraph that you made to look like as part of my quote, was actually a comment by you, not me.

That said, Section 501(c)(1) through 501(c)(29) of the Internal Revenue Code define the types of entities that are eligible to be tax exempt. Someone here said that 501(c)(6) of the IRC is the exemption that the NFL has used.

See the following link for Section 501. You can see the types of entities if you go to Section (c).

Can you tell me -- or not -- what the reasons are for allowing some Orgs to be non-profit?

And, how is it that orgs like the NFL should be included in that category.

Citing the sections of the Code tells us nothing; as we all know (we do know this, don't we, much (if not all) of the IRC is written by special interests injecting tax loopholes for themselves. I am sure it is all legal that the NFL is a tax exempt. I want the reason/excuse for why it is legitimate, fair, just, that they have such an exemption.

The Why.

Not the How.

I don't know the reason why (I am not a tax attorney or accountant) though I am sure there was a reason when it was included just like there is a reason that unions are considered tax exempt. Maybe for the reason you asserted but I don't know and never really cared enough to think about it.

Goodell's salary does get taxed though as it is personal income and not income for the NFL. And a lot of the NFL's revenue does go straight to the teams so those moneys are taxed.

In fact, at least in 2011 and previously, I read that the NFL (the tax exempt entity) lost money (the NFL teams on the other hand made money and are taxed) so it's not like the taxpayers lost out on this tax exempt status.

Klondike5 wrote:

Can you tell me -- or not -- what the reasons are for allowing some Orgs to be non-profit?

And, how is it that orgs like the NFL should be included in that category.

Citing the sections of the Code tells us nothing; as we all know (we do know this, don't we, much (if not all) of the IRC is written by special interests injecting tax loopholes for themselves. I am sure it is all legal that the NFL is a tax exempt. I want the reason/excuse for why it is legitimate, fair, just, that they have such an exemption.

The Why.

Not the How.

I'm pretty sure there isn't an actual good moral reason for it. I'm also pretty sure there isn't a good moral and fair reason for the CEO of a non-profit to make more than a million a year, but, as stated, they can and often do. Both of these cases are due to it being far cheaper for rent-seekers to lobby the governemnt for unfair legislation than it is for them to actually cease to be rent-seekers.

And by the way, the $9 billion in revenue referred to by Willow is the whole industry which includes team revenue. Most of that is to the teams. The tax exempt entity is under $1 billion in revenue though I can't find the exact amount now.

I hope this was not glossed over:

Money generated from sources like NFL Network, national sponsorship deals and merchandise fall under the umbrella of a for-profit company called NFL Ventures, which is owned by the 32 teams, not by the league office. Accordingly, this money is already subject to taxation.

It is unlikely that any other nonProfit ceo make 30 million but that is more because pretty much no ceo makes that much on a regular basis. You get those one time stock grants and the like but most of the crazy high financial pay goes to the financial manipulators. If given a choice between being a ceo or hedge fund manager, go with the hedge fund. You will get paid 10x as much

Know the Definitions wrote:

And by the way, the $9 billion in revenue referred to by Willow is the whole industry which includes team revenue. Most of that is to the teams. The tax exempt entity is under $1 billion in revenue though I can't find the exact amount now.

I am pretty sure we already established that the tax exempt entity claims losses rather than income. Which is also weird. For a not for profit

Left Said Fred wrote:

I hope this was not glossed over:

Money generated from sources like NFL Network, national sponsorship deals and merchandise fall under the umbrella of a for-profit company called NFL Ventures, which is owned by the 32 teams, not by the league office. Accordingly, this money is already subject to taxation.

Presumably in addition to the $9 billion per year figure already quoted? Not to be glossed over

Klondike5 wrote:

Left Said Fred wrote:

I hope this was not glossed over:

Money generated from sources like NFL Network, national sponsorship deals and merchandise fall under the umbrella of a for-profit company called NFL Ventures, which is owned by the 32 teams, not by the league office. Accordingly, this money is already subject to taxation.

Presumably in addition to the $9 billion per year figure already quoted? Not to be glossed over

This article seems to state that broadcasting, sponsorship, concessions, etc are all included in the $9 Billion. Remember that Willow said that the industry the NFL is a $9 billion in annual revenue for the industry which is different than entity so it incorporates all revenues from the teams, NFL Ventures, and the nonprofit NFL entity. Broadcasting rights are $4 Billion a year alone according to the article.

Also, here is the 2010 tax return that shows revenue for the non-profit entity of $184 million (the roughly $6 million NFL dues that each team pays to the NFL to join the league) and a $52 Million net loss. The rest of the $9 Billion is going to taxable entities

As someone said before, if you want to criticize something, I can see looking at the stadium deals as something that is hurting the tax payer. Some jurisdictions have successfully fought the stadium deals. Others not so much.

Why would the NFL organize itself as a non-profit if it is, by its accounting, losing money?

If the NFL was a normal corp some of the money would be taxes twice (first at the corporate level then as individual income) because you are only allowed to write off something like 1 million in salary. Now there are loopholes around that (various type of incentive pays). Obviously you can debate if that is a good thing or bad thing.

Know the Definitions wrote:

I don't know the reason why (I am not a tax attorney or accountant) though I am sure there was a reason when it was included just like there is a reason that unions are considered tax exempt. Maybe for the reason you asserted but I don't know and never really cared enough to think about it.

Goodell's salary does get taxed though as it is personal income and not income for the NFL. And a lot of the NFL's revenue does go straight to the teams so those moneys are taxed.

In fact, at least in 2011 and previously, I read that the NFL (the tax exempt entity) lost money (the NFL teams on the other hand made money and are taxed) so it's not like the taxpayers lost out on this tax exempt status.