I have read article after article and there have been more than a few threads about relaxing rules, paying players, unionizing exc. The solution seems really simple: do what you want, pay whomever whatever you want, (probably avoid title IX requirements), manage your business the way you need to. While you are at it pay taxes on your income and what you pay these players. The NCAA is already the minors for the NFL & NBA might as well make it official.

With the proliferation of for profit universities lately, this seems to be a great opportunity for the IRS to reclassify some of these institutions.

reading these repeated threads like this just reminds you why the USA is one of the most financially challenged countries on the face of the earth when it comes to both individuals and government

1. the VAST majority of (as in all but about 10-12 out of 128) D1-A athletics programs do not turn a profit and the VAST majority (as in all but about 15 out of 128) rely on subsidies from the academic side

things that do not turn a profit do not get taxed

2. income taxes even for individuals and especially for corporations are not based strictly on bottom line total revenue they are based on profits in the case of corporations and even for individuals you can offset even 100% of your income with charitable contributions if you desire and pay no taxes even on a large income

3. social security taxes paid by both the individual and the company go into algores lock box and are not available for general revenue use......oh wait that is actually kind of BS because the only lock box algore knows anything about is the one where his testicles are located and the US Treasury raids the social security trust fund regularly and places "IOUs" in it with something like 1-2% interest owed on that "borrowing" so the money gets used for general expenses, but one day it will have to be paid back with a really really crappy interest rate of return on it which is partially why social security will go broke one day and is a ponzi scheme

but still the reality is that the only taxes you will ever collect from college athletics is social security and income taxes on the actual athletes and taxing the athletes on income is now what the fools that want to pay players or tear apart college athletics really want they want a way for government to take and waste a portion of the money that is generated by college athletics in the feigned hope that it will somehow generate "equality" for the begging bowl holder programs

4. the very few college programs that do turn any type of real profit will simply get rid of that profit by handing it over as a tax deductible contribution to the academic side of the university or they will hand over a very large portion of total income to the academic side and then the academic side will make grants to student athletes that will be non-taxable or only taxed on a very small portion and again it will be the student athlete owing the taxes not the university or the athletics department and if you start taxing grants and scholarships then you are going to to so for 100% of those that get them even non-athletes

5. large programs will find a way to shelter 100% of their income from any taxes besides possibly payroll taxes and those same payroll taxes will apply to 100% of the programs that participate in that system no matter their total revenue or their net loss or their potential profit so it will end up hurting those programs long before it does anything to the large programs that begging bowl fans wish to tear apart even come close to being harmed.......so you are planning and hastening your own destruction with these types of foolish plans

6. the vast majority of D1-A athletics programs and especially the ones that have income above revenues are state owned entities and that is not going to change and states are not going to let the federal government start taxing their university systems even if it is "athletics income" that will simply not happen period the end and even if it is attempted that income will be shifted and the distribution of it will be changed so that it is state income and thus not taxable by the feds period the end

it is amazing the lack of even basic understanding of how taxes and income and profits works for even the average supposed "educated" American much less the dramatic failings of silly plans like this or the outcomes of them if the were ever possibly implemented

The only ones to get taxed would be players. Once declared employee like professional athletes any income including the gift of tuition food etc.. would be taxable. I seriously doubt paid athletes wish to donate all their profit to charity. Just like the coach they would be subject to taxes.
The only way around this would be if the government created a special exemption for students.

(05-25-2014 08:38 AM)cleburneslim Wrote:  The only ones to get taxed would be players. Once declared employee like professional athletes any income including the gift of tuition food etc.. would be taxable. I seriously doubt paid athletes wish to donate all their profit to charity. Just like the coach they would be subject to taxes.
The only way around this would be if the government created a special exemption for students.

And there's a good chance the value of the taxable portion of what they got wouldn't be high enough for them to have to pay income taxes unless they had other income, except maybe for a handful of players.

(05-24-2014 11:25 PM)Sam Minuteman Wrote:  I have read article after article and there have been more than a few threads about relaxing rules, paying players, unionizing exc. The solution seems really simple: do what you want, pay whomever whatever you want, (probably avoid title IX requirements), manage your business the way you need to. While you are at it pay taxes on your income and what you pay these players. The NCAA is already the minors for the NFL & NBA might as well make it official.

With the proliferation of for profit universities lately, this seems to be a great opportunity for the IRS to reclassify some of these institutions.

Did you take your name from the children's book of that name?
We picked up a copy in Lexington a couple years back.

(05-25-2014 01:46 AM)TodgeRodge Wrote:  5. large programs will find a way to shelter 100% of their income from any taxes besides possibly payroll taxes and those same payroll taxes will apply to 100% of the programs that participate in that system no matter their total revenue or their net loss or their potential profit so it will end up hurting those programs long before it does anything to the large programs that begging bowl fans wish to tear apart even come close to being harmed.......so you are planning and hastening your own destruction with these types of foolish plans

6. the vast majority of D1-A athletics programs and especially the ones that have income above revenues are state owned entities and that is not going to change and states are not going to let the federal government start taxing their university systems even if it is "athletics income" that will simply not happen period the end and even if it is attempted that income will be shifted and the distribution of it will be changed so that it is state income and thus not taxable by the feds period the end

it is amazing the lack of even basic understanding of how taxes and income and profits works for even the average supposed "educated" American much less the dramatic failings of silly plans like this or the outcomes of them if the were ever possibly implemented

To be tax deductable, the enterprise has to have a tax deductable mission that falls under the IRS codes. If athletics are excluded from the educational mission that would have far reaching impact across society. For example a community foundation that today gives money to the county recreation agency for new uniforms, that would all go away as a taxable enterprise.

The recreational softball league would have to set up a for profit entity. Now the community foundation could still purchase a service to make and distribute the uniforms as a business venture outside of the foundation but they loose the ability pass through charitable donations for community recreation. If the operating income of the foundation is large enough overall they could still make and sell uniforms provided their board agrees with the approach.

College athletics is already split on taxable (ticket sales, TV money) and non-taxable lines (donations, scholarships). What the P5 is trying to prevent is law suits from injuries by modernizing supplemental insurance. Also giving players more flexibility, stipends things the unionizing movement is trying to push. If it ever came down to a Supreme Court decision that college athletes were determined to be employees of the university, it actually would be a good thing for universities.

1. As employees the athletes would fall under the employee union and not have the ability to bargain for specific rights in a student athlete union, specifically high risk category insurance.

2. Universities with their scholarships are paying students room and board. Since all university employees can take classes for free they wouldn't have to put the value of tuition anymore as a line item under the athletic department. That lowers athletic budgets right there by several million for every school.

3. Since 80% of the scholarship is going to cover tuition and that goes away, the only thing the school would be obligated to give the athletes is 12,000 dollar graduate level stipend to cover boarding costs.

If I'm a P5 school with a 70 million dollar athletic budget I look at paying the players as an added expense because before with the room/board scholarship model it didn't cost anything aside from utilities to have the players. The large size of the athletic budget is accepted within the university community as the cost of doing business in the SEC, B1G and PAC ect. There are a lot of high end corporate thinking professors at those schools. If I'm a G5 school with a 30 million dollar athletic budget that is under constant faculty scrutiny as to whether athletics brings value to a university, paying the players is exactly the model that you want to move to because it lowers the athletic budget from 30-25 million plus strengthens the faculty union's hand in negotiations.

All the P5 really wants is to co-opt the unionization process with upgraded insurance a stipend (4,000-5,000), ability for continuing education after having completed a 4 year scholarship ect. They don't want to get started down the path of paying 15,000 per student athlete if they don't have to. G5 schools are chomping at the bit for their own autonomy because if they get it and the non-FBS conferences can't vote in the changes they'll be at a huge competitive advantage over the MVC, Big West, Southern Conference ect. They don't have to match the P5 on the stipends either so long as they add high risk insurance and continuity to finish their degree.

(05-25-2014 11:15 AM)bullet Wrote:  

(05-25-2014 08:38 AM)cleburneslim Wrote:  The only ones to get taxed would be players. Once declared employee like professional athletes any income including the gift of tuition food etc.. would be taxable. I seriously doubt paid athletes wish to donate all their profit to charity. Just like the coach they would be subject to taxes.
The only way around this would be if the government created a special exemption for students.

And there's a good chance the value of the taxable portion of what they got wouldn't be high enough for them to have to pay income taxes unless they had other income, except maybe for a handful of players.

The full cost of tuition would be taxable so if what a student is given free as compensation including room and board, tuition, food, stipend, anything is taxable and supposed to be reported.
If a person gives you a house for some service performed you are required to list that as other income on your taxes and pay appropriate taxes on it. So if tuition at duke was 40,000 dollars a year you would owe taxes on your compensation for services rendered. Since players are mostly single and none that is a sizeable tax.

Al least twenty years ago, the IRS attempted to tax bowl game revenue as corporate sponsorship income. Obviously it didn't work. The NCAA complained to Congress and got their way.

(05-25-2014 01:46 AM)TodgeRodge Wrote:  reading these repeated threads like this just reminds you why the USA is one of the most financially challenged countries on the face of the earth when it comes to both individuals and government

1. the VAST majority of (as in all but about 10-12 out of 128) D1-A athletics programs do not turn a profit and the VAST majority (as in all but about 15 out of 128) rely on subsidies from the academic side

things that do not turn a profit do not get taxed

2. income taxes even for individuals and especially for corporations are not based strictly on bottom line total revenue they are based on profits in the case of corporations and even for individuals you can offset even 100% of your income with charitable contributions if you desire and pay no taxes even on a large income

3. social security taxes paid by both the individual and the company go into algores lock box and are not available for general revenue use......oh wait that is actually kind of BS because the only lock box algore knows anything about is the one where his testicles are located and the US Treasury raids the social security trust fund regularly and places "IOUs" in it with something like 1-2% interest owed on that "borrowing" so the money gets used for general expenses, but one day it will have to be paid back with a really really crappy interest rate of return on it which is partially why social security will go broke one day and is a ponzi scheme

but still the reality is that the only taxes you will ever collect from college athletics is social security and income taxes on the actual athletes and taxing the athletes on income is now what the fools that want to pay players or tear apart college athletics really want they want a way for government to take and waste a portion of the money that is generated by college athletics in the feigned hope that it will somehow generate "equality" for the begging bowl holder programs

4. the very few college programs that do turn any type of real profit will simply get rid of that profit by handing it over as a tax deductible contribution to the academic side of the university or they will hand over a very large portion of total income to the academic side and then the academic side will make grants to student athletes that will be non-taxable or only taxed on a very small portion and again it will be the student athlete owing the taxes not the university or the athletics department and if you start taxing grants and scholarships then you are going to to so for 100% of those that get them even non-athletes

5. large programs will find a way to shelter 100% of their income from any taxes besides possibly payroll taxes and those same payroll taxes will apply to 100% of the programs that participate in that system no matter their total revenue or their net loss or their potential profit so it will end up hurting those programs long before it does anything to the large programs that begging bowl fans wish to tear apart even come close to being harmed.......so you are planning and hastening your own destruction with these types of foolish plans

6. the vast majority of D1-A athletics programs and especially the ones that have income above revenues are state owned entities and that is not going to change and states are not going to let the federal government start taxing their university systems even if it is "athletics income" that will simply not happen period the end and even if it is attempted that income will be shifted and the distribution of it will be changed so that it is state income and thus not taxable by the feds period the end

it is amazing the lack of even basic understanding of how taxes and income and profits works for even the average supposed "educated" American much less the dramatic failings of silly plans like this or the outcomes of them if the were ever possibly implemented

Exactly....you can only tax profits and very few schools make a profit and those that do could easily cook the books so that expenses equaled income, thus no profit.

(05-25-2014 05:21 PM)cleburneslim Wrote:  

(05-25-2014 11:15 AM)bullet Wrote:  

(05-25-2014 08:38 AM)cleburneslim Wrote:  The only ones to get taxed would be players. Once declared employee like professional athletes any income including the gift of tuition food etc.. would be taxable. I seriously doubt paid athletes wish to donate all their profit to charity. Just like the coach they would be subject to taxes.
The only way around this would be if the government created a special exemption for students.

And there's a good chance the value of the taxable portion of what they got wouldn't be high enough for them to have to pay income taxes unless they had other income, except maybe for a handful of players.

The full cost of tuition would be taxable so if what a student is given free as compensation including room and board, tuition, food, stipend, anything is taxable and supposed to be reported.
If a person gives you a house for some service performed you are required to list that as other income on your taxes and pay appropriate taxes on it. So if tuition at duke was 40,000 dollars a year you would owe taxes on your compensation for services rendered. Since players are mostly single and none that is a sizeable tax.

Its not that simple with scholarships.

It isnt simple now as students. As employees it is straight forward and taxable.

I don't pretend to know tax law, my point is simply that everyone associated with "big time" college athletics treats it like a business so why shouldn't it be treated like a business.

Players don't see value in their scholarship? Start taxing it and they will learn the value real quick!

I'm sure schools (that do make money) will find ways of spending it all so that they can show a loss and not pay anything but maybe they won't.

The NCAA, Conferences, Schools, & athletes all want benefits without giving anything up. It is unrealistic but sure would be funny to see their faces when tax bills came due.

(05-27-2014 12:21 PM)Sam Minuteman Wrote:  I don't pretend to know tax law, my point is simply that everyone associated with "big time" college athletics treats it like a business so why shouldn't it be treated like a business.

Players don't see value in their scholarship? Start taxing it and they will learn the value real quick!

I'm sure schools (that do make money) will find ways of spending it all so that they can show a loss and not pay anything but maybe they won't.

The NCAA, Conferences, Schools, & athletes all want benefits without giving anything up. It is unrealistic but sure would be funny to see their faces when tax bills came due.

Ah, yes. Another G5 lament. Let's see how much political support there is from the Senators and Congress members from P5 states to tax their OWN public flagship universities. Washington taking more money from the states is already not exactly a popular concept. Now, you're actually going to have the federal government ACTIVELY take money AWAY from Bama, Ohio State, the Gators, Longhorns, et. al? We'll see how long those people last in office.

At the same time, the fact that a non-profit engages in activities that look business-like don't suddenly mean that they're for-profit entities. Non-profits, in order to not actually go bankrupt, have to take in more revenue than expenses. You can't have a non-profit constantly operating at a loss or else it will no longer exist in the long-term. Your local hospital that's charging thousands of dollars for routine medical care? Non-profit. And let's not forget the greatest non-profit entity of them all: the National Football League. (Yup, it's true. If the NFL can figure out a way to maintain non-profit status, it's easy as pie for Big Ten and SEC schools to do the same.)

The bigger impact from a loss of tax-exempt status would be that individuals would no longer be able to take tax deductions for their contributions to the schools. I'd imagine the contributions would dry up pretty quickly at that point but if supporters did still contribute then the federal govt. could realize more revenue from the lack of the previous charitable tax deduction regardless of whether the intstitutes turn a profit or not.

This is all just conjecture though because it will never happen. You'd have to make the entire University a taxable entity or else spin off the athletic branch into a separate entity in which case, of coarse it would be taxed because the only reason athletics enjoys tax-exempt status is because of the association with the academics.

...and Todge Rodge, if you're going to be a condescending ass atleast get your facts right.