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Lockout fund raises questions, concerns

bag-of-money

Apart from the fact that any veteran player needing to dip into the $60,000-max-per-player lockout fund in April may never make it past one week without a game check, the players’ supplemental revenue stream during the work stoppage has given rise to a couple of concerns.

First, as one agent pointed out to PFT, tax consequences will apply to at least a portion of the money.  Up to $30,000 of the $60,000 constitutes reimbursement of dues payments in the amount of $15,000 per year.  The other $30,000 comes from income generated by the NFLPA* via the selling of group licensing rights.

We’re told that the NFLPA* has considered alternative labels for the payments aimed at making them something other than income, such as reimbursement for health insurance expenses during the lockout.  For now, however, the plan is to make the payments, subject to any and all potential tax liabilities.

The next question becomes whether the players were told to expect that taxes will have to be paid.  Though it likely won’t be an issue until next April, the NFLPA* could be facing a flurry of unhappy phone calls in early 2012.

Another agent points out that the NFLPA* should be trying not to help only veteran players make it through a lockout, but that the NFLPA* should be thinking about taking care of the rookies, who have never been paid to play football.

(Unless they went to Auburn.)

Under the system devised by the NFLPA*, every player who has been on a roster for the past two years has $60,000 available in lockout money — including guys like Peyton Manning and Drew Brees and Tom Brady.  It would make much more sense, then, to reconfigure the lockout fund to take care of the guys who truly need the money, because those guys are the ones who will be the most likely to crack in September.

Or earlier.

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30 Responses to “Lockout fund raises questions, concerns”
  1. purplescar says: Mar 31, 2011 9:06 AM

    Are you kidding? ARE YOU KIDDING ME? Now they’re going to whine about paying taxes on their own little lockout insurance scam? Unbelievable.

  2. irishdawg42 says: Mar 31, 2011 9:13 AM

    I have two questions..

    1) Shouldn’t money being controlled by an organization that no longer exists(NFLPA) be frozen and held in escrow until another entity takes over those assets?

    2) How are individuals who have legally left that organization that no longer exists and declared it de-certified able to lay claims to any money that they left behind? I know when I left my union job to take a management position IN THE SAME COMPANY. I gave up all rights of that union’s assets and claims towards them in case of layoffs(lock out) or any other situation that arose.

    The only rights I retain are the portion of pension when I retire…So I guess the retirees would have some claims on this money, but players who willingly left this organization should not…Right?

  3. wryly1 says: Mar 31, 2011 9:14 AM

    We fans have been expressing our strong opinions and criticisms of both sides. I’ve been trying to take it all in for consideration and arrived at the following bottom line question : Is the long term best interest of everyone involved better served by players playing the games – and coaches coaching the – for the millions of fans … or is it about 32 individual owners tampering with the sport for their own profit ?

  4. eagleswin says: Mar 31, 2011 9:15 AM

    Another agent points out that the NFLPA* should be trying not to help only veteran players make it through a lockout, but that the NFLPA* should be thinking about taking care of the rookies, who have never been paid to play football.

    (Unless they went to Auburn.)
    ——————–
    (Cue the drum roll)

    Cam’s gotta get paid, he’s an entertainment icon.

    All kidding aside, this is an alarming development from the NFLPA. Players normally wouldn’t have income from this time of the year anyway (including the rookies) so why the need to release it now? You would think they would save it until August at least. This signals a much worse financial problem for the players than the NFLPA has admitted to.

    What I want to know is what Brees, Manning, and Brady are doing for the players. They could give every single player in the league $6,000 to cover health insurance for the offseason and only be out $3 million each which for Manning is only 12% of next year’s salary.

    If someone making $24 mill next year is doing this to help the rank and file don’t you think he should actually, you know, help the rank and file? C’mon Manning, Brees, Brady open up your wallets and help the union. You sure like to spend the owners money so how about spending a small portion of your own?

  5. smarterthantheaveragebearfan says: Mar 31, 2011 9:19 AM

    I am quite sure that folks like Brady, Manning, Brees and other high net worth players (“I have 80 million in the bank” Carson Palmer) will not be asking for any of this money.

    At the and of the day I would bet that less than 25% of the players will make a request for these funds.

  6. eagleswin says: Mar 31, 2011 9:33 AM

    wryly1 says:
    Mar 31, 2011 9:14 AM
    We fans have been expressing our strong opinions and criticisms of both sides. I’ve been trying to take it all in for consideration and arrived at the following bottom line question : Is the long term best interest of everyone involved better served by players playing the games – and coaches coaching the – for the millions of fans … or is it about 32 individual owners tampering with the sport for their own profit ?
    ——————-
    This reminds me of the old groucho marx question “Have you stopped beating your wife? Yes or No?”. The way the question is phrased there is no good answer. The respondant is vilified either way. Your question has about as much merit as Groucho Marx’s question, which is none. It presumes to lay all the blame on one party regardless of the facts and at least Groucho did it for a laugh.

    The long term best interest is served by maintaining the competitive playing field among all 32 teams. Removing the salary cap and draft greatly impair that goal. The players are suing to get rid of the salary cap and draft. Those are the facts. If it takes short term pain for long term gain, so be it.

  7. gtfan says: Mar 31, 2011 9:40 AM

    irishdawg42, the NFLPA still exists, it is just no longer a union (it’s now a trade association). That’s t he answer to both of your questions.

  8. airraid77 says: Mar 31, 2011 9:45 AM

    in any reasonable, centralized court, the union is going to get slapped silly.

  9. johnv5 says: Mar 31, 2011 9:48 AM

    OMG! Players might have to pay high premiums for health insurance! They can’t get more than $60,000? …Gentlemen, get a taste of what the realities of life retired football players deal with.

  10. bhindenemylines says: Mar 31, 2011 9:54 AM

    “At the and of the day I would bet that less than 25% of the players will make a request for these funds.”

    You may be right. But I guarantee that Dez Bryant is one of the 1st of the 25% to request it.

    And I’m A Cowboys fan.

    And I bought his jersey this offseason.

    Efff me………………

  11. dvnelson72 says: Mar 31, 2011 9:55 AM

    How exactly do we determine need? If it is based on cumulative past salaries, Charlie Batch is screwed.

    I guess the players need to open their individual books so that the league can examine their assets and liabilities?

  12. commoncents says: Mar 31, 2011 9:57 AM

    Someone tell Dez he needs to pay this money back.

  13. mick730 says: Mar 31, 2011 9:58 AM

    Interesting. So the poor players could afford to pay $15,000.00 per year to their union, but now they’re claiming they can’t make their COBRA payments to cover their health insurance?

    Please.

  14. packa7x says: Mar 31, 2011 10:06 AM

    So…the players deserve sympathy for wanting to DODGE TAXES despite being some of the highest earners in the country.

    The owners deserve hatred for wanting to make the sport sustainable for the long run and realize a profit on their investment?

    People have this ass backwards.

  15. CKL says: Mar 31, 2011 10:09 AM

    Wait a minute…are union dues deducted from the players’ checks before taxes? If they are not, then how the eff can there be taxes owed on a refund of them? If they are pre tax well then…that stinks.

  16. petedutcher says: Mar 31, 2011 10:24 AM

    “We’re told that the NFLPA* has considered alternative labels for the payments aimed at making them something other than income, such as reimbursement for health insurance expenses during the lockout.”

    Interesting. Wouldn’t that be a federal crime? Tax evasion?

    I ask you all, do people this stupid deserve to be paid so much?

  17. blackshirtz says: Mar 31, 2011 10:27 AM

    Wait a minute…… wasn’t it the Union formerly known as the NFLPA who were complaining about the owners setting money aside for lockout insurance?

    Soooooo the owners can budget… and the players cannot……

    Pot, meet kettle. “Hey kettle, you’re black.”

  18. packa7x says: Mar 31, 2011 10:28 AM

    @CKL…

    If it’s taxed twice, you can thank our awesome socialist leaders. How else are we going to pay for our stimulus bill and universal health care? OH! That’s right, punish the most productive people in the country!

  19. burntorangehorn says: Mar 31, 2011 10:40 AM

    Soon Angelina Jolie and Madonna will start accessorizing with adopted, less-fortunate NFL players, and Anderson Cooper will chronicle their pain and suffering.

  20. paulitik74 says: Mar 31, 2011 10:40 AM

    I’m sure the owners weren’t devising a plan to get out of paying taxes on the $4 billion they scammed out of the broadcasters.

    2/3rds of American corporations paid no taxes last year. It’s ridiculous to blame the players for doing what everybody does already.

    This lockout is on the owners 100%. The players aren’t holding the season hostage.

  21. petedutcher says: Mar 31, 2011 10:48 AM

    packa7x says:
    Mar 31, 2011 10:28 AM
    @CKL…

    If it’s taxed twice, you can thank our awesome socialist leaders. How else are we going to pay for our stimulus bill and universal health care? OH! That’s right, punish the most productive people in the country!

    By drilling for oil in the gulf and in the United States, which would enable us to sell oil to other countries. That’s right…the US COULD be making money the same way Arab nations do.

  22. smarterthantheaveragebearfan says: Mar 31, 2011 10:55 AM

    packa7x says: Mar 31, 2011 10:06 AM

    So…the players deserve sympathy for wanting to DODGE TAXES despite being some of the highest earners in the country

    ————————

    They are just following the lead of GE. Turn a profit of $14 BILLION dollars (billion with a b) and pay no/zero US taxes.

  23. bunjy96 says: Mar 31, 2011 11:15 AM

    It will be interesting what account name is on the check and who signed it.

  24. axespray says: Mar 31, 2011 11:33 AM

    burntorangehorn says:
    Mar 31, 2011 10:40 AM
    Soon Angelina Jolie and Madonna will start accessorizing with adopted, less-fortunate NFL players

    ^ I Legit LoL’d

  25. melikefootball says: Mar 31, 2011 12:17 PM

    Do you hear the sound of laughter in the Brady, Manning and Brees homes. Hey honey, where are we going for vacation this year, I have a check coming.

  26. irishdawg42 says: Mar 31, 2011 12:44 PM

    “”irishdawg42, the NFLPA still exists, it is just no longer a union (it’s now a trade association). That’s t he answer to both of your questions.””

    @gtfan

    The union is the entity that collected the money…the union is the entity handing out the money…THE TRADE ASSOCIATION IS NOT A UNION OR PART OF THE OLD UNION.

    NFLPA, does NOT exist, they WERE the union. They are now the Trade Association of Players…who ironically are paying De Smith(albeit no money until a new deal is done) to be their advisor..

    I ask you, if a competing company asked your company if they could use you as an advisor, but would not compensate you in any way, would your company say…OK, no problem?

    This trade association is in direct opposition to the union for which De Smith is employed(in theory)..if they are not then you must declare the de-certification a sham.

  27. biggerballz says: Mar 31, 2011 12:54 PM

    only players are so dense they don’t think they have to pay taxes on income. Yes this is your partner NFL good job creating the monster, shut down the season and bring these primadonnas back to reality.

  28. Deb says: Mar 31, 2011 2:42 PM

    I’m not sure why the lockout fund would be distributed before the start of the season, but it’s not a great idea. And I would hope the trade association would distribute the funds with a letter of explanation about player responsibilities regarding taxes. Stupidity has nothing to do with it. NFL players certainly aren’t the only people who find the U.S. Tax Code confusing.

  29. commandercornpone says: Mar 31, 2011 5:09 PM

    september? more like may.

  30. dapple5 says: Mar 31, 2011 9:09 PM

    If the eligibility of the players to receive these payments requires that they have been on the active 53 man roster for the past TWO years what about last year’s rookies? Obviously they were only on the roster 1 year. Seems to me, unless I am missing something here, that their former union is putting the big screw to them!

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