clock menu more-arrow no yes

Filed under:

NFL to give up it's tax exempt status

New, comment

Roger Goodell, the commissioner of the National Football League announced to team owners and members of Congress that the NFL would be eliminating the "distraction" that is the NFL's tax exempt status.

Kirby Lee-USA TODAY Sports

Roger Goodell, the commissioner of the National Football League announced to team owners and members of Congress that the NFL would be eliminating the "distraction" that is the NFL's tax exempt status. Quite a huge move given that the NFL as a whole generates an estimated $9.5 Billion per year.

"Every dollar of income generated through television rights fees, licensing agreements, sponsorships, ticket sales, and other means is earned by the 32 clubs and is taxable there," Goodell wrote. "This will remain the case even when the league office and Management Council file returns as taxable entities, and the change in filing status will make no material difference to our business."

While it might appear that Goodell will be under major fire from team owners, think again. By pre-emptively striking and biting the bullet by voluntarily taking the tax hit, the NFL gets to remove leverage for Congress in what has become regular inquiries on how it is handling concussions and domestic violence. Of course, by now being non tax-exempt, it also removes the necessity of federal disclosure into Goodell's salary and some of the other league information that the league would rather keep out of the public eye.

Bloomberg reports that the tax break is pretty minimal, with only $109 million being owed over the next decade. So the hit isn't as bad as most people would have assumed. With such a little effect, the NFL and Goodell get to remove quite a bit of public scrutiny and should be able to push off further outcry over other PR issues that the NFL has had to face in recent years.