Plenty of NFL owners are Republicans. And so they may be feeling more than a little betrayed by the fact that a Republican senator is openly complaining about the tax-exempt status of the league office.
Tom Coburn, who represents Oklahoma, included in his “Wastebook 2012” reference to the NFL’s non-profit characterization as one of 100 examples in which the government is getting a raw deal.
The league’s tax-exempt status became a talking point during the 2011 lockout, with NFLPA Executive Director DeMaurice Smith repeatedly chiding the league regarding a label more commonly associated with charities. The league’s position was, and is, that all money flows through the league office to the teams, and the teams pay the taxes. That’s what NFL spokesman Greg Aiello told CNN.com in response to Coburn’s contentions.
Here’s the reality. The NFL fits within the current legal definition of a non-profit business association. If the IRS disagrees, then the issue should be litigated. And if Congress thinks that the government is getting screwed by the definition of a non-profit business association, Congress should pass a new law.
The ultimate question is whether and to what extent the owners ultimately would pay more money if the league office wasn’t exempt from taxes. Presumably, it would be more expensive for the league; otherwise, the league wouldn’t do it. But without knowing the specific additional dollars and cents that Uncle Sam would realize by closing the eye of the needle through which the fat cats are fitting, it’s hard to gauge how big of a deal this could be for the league.
Either way, the Republicans who own NFL teams may want to remind guys like Senator Coburn that the first thing to go if the cost of doing business increases will be political contributions.