NFL’s financial analysis you should know

Why does the NFL want to unilaterally abandon it and become a private, for-profit company? We need to consider how tournaments work and the benefits and costs of being a nonprofit.

The NFL’s most recent 990 model, shown in the image below, shows that between April 2012 and March 2013, the NFL generated $ 327 million in revenue and a net worth of $ 788 million. shout at the end of the period.

Even with all this money, the NFL made an online profit of just $ 9 million. One reason the increase is so low is that the NFL paid its top employees more than $ 60 million that year alone, or nearly a fifth of all revenue! The Commissioner, Roger Goodell, received $ 44 million in salary, bonus and other compensation, while the other five key employees earned $ 19 million.

The nonprofit is expected to do some charity work. So even with millions of revenue, it has given away just $ 1.6 million, the majority of which went to the NFL Foundation or the NFL Alumni Association. The rest are relatively small donations to organizations. For example, the March of Dimes and the Big Brothers.

In the tax code, the NFL is considered a 501 (c) (6) nonprofit, a category that is intended to exempt local chambers of commerce and business associations from paying taxes as long as they benefit the whole industry or business help.

However, the 501 (c) (6) category has one more category in the list of exempt institutions: Professional Football Championship, Added in 1966. Other sports, like Hockey League the country, generating $ 80 million in revenue, and the Professional Golfers’ Association, with $ 91 million, also achieved a non-profit status under this 501 (c) (6) rule.

This particular category has won the Congress ire. Most recently, Utah Representative Chaffetz introduced a bill in January to revoke the non-profit status of professional sports teams with revenues of more than $ 10 million.