House chairman presses NFL on tax exemption

House Oversight Committee Chairman Jason Chaffetz (R-Utah) wants to know exactly what the National Football League and other professional sports organizations get out of their current tax exemption.

Chaffetz, a long-time critic of the NFL’s tax status, pressed Commissioner Roger Goodell for more information about how much the league saves because of its exemption, and whether it considered giving up the exemption.

{mosads}The Oversight chairman, a former kicker at Brigham Young University, also sent the letter to 10 other sports associations, including the National Hockey League, two lacrosse leagues, three golf associations, two tennis tours and the Professional Rodeo Cowboys Association.

In his letter, Chaffetz noted that the IRS currently views the leagues as trade associations, similar to the U.S. Chamber of Commerce. But he also said that the IRS now believes that the NFL’s exemption, now almost a half-century old, shouldn’t have been handed out.

“If not for the 1966 classification for professional football leagues and subsequent IRS interpretation, professional sports leagues would not be eligible for tax exempt status under 501©(6) because they do not meet the traditional definition of a trade association,” Chaffetz wrote.

Chaffetz has introduced a measure to roll back the tax exemption for leagues like the NFL, which would raise roughly $109 million over a decade. Major League Baseball and the National Basketball Association don’t have tax exemptions.

Among other questions, Chaffetz also asked Goodell whether the NFL is exempt from state and local taxes, whether it has ever sought exemptions for special events and how the league promotes the business interests of its members.

Critics of the NFL’s tax exemption have also pointed to Goodell’s salary, which has been estimated to be tens of millions of dollars a year. 

NFL officials, meanwhile, have noted that the league offices are tax-exempt but the 32 teams aren’t, nor is income from game tickets, television fees and a range of other profits.