Not-For-Profit status

[Kolumbo]

Let's say the P5 split to form a D4. The government could step in and say, "Congratulations P5. You have demonstrated tremendous zeal and ingenuity in colluding to maxime your revenues and to increase the divide between yourselves and the others. Based on your actions, you have established that your athletic programs are "for-profit" and will be taxed as such." Makes sense to me. No?

 

[pj]

Antitrust prosecution would be much more in line with the law. Assuming the government wanted to persecute immensely powerful institutions it has spent decades massively subsidizing.

 

[upstater]

Let's say the P5 split to form a D4. The government could step in and say, "Congratulations P5. You have demonstrated tremendous zeal and ingenuity in colluding to maxime your revenues and to increase the divide between yourselves and the others. Based on your actions, you have established that your athletic programs are "for-profit" and will be taxed as such." Makes sense to me. No?

Just think about it, the NFL is a non-profit entity.

 

[uconndogs]

Just think about it, the NFL is a non-profit entity.

Non-profit member owned structure I assume with the individual franchises as for-profits. I don't pretend to understand the regs for non-profit status, but I have to believe classifying athletic departments as taxable organizations would be a real kick in the balls.

 

[Kolumbo]

Non-profit member owned structure I assume with the individual franchises as for-profits. I don't pretend to understand the regs for non-profit status, but I have to believe classifying athletic departments as taxable organizations would be a real kick in the balls.

I've done some reading and clearly times have changed. Some universities are enjoying both not-for-profit status AND big business profits. The fact that they want to keep as much profits for themselves while shutting out others is a total greedy money grab which should not be allowed. Kick them really hard!

 

[upstater]

I've done some reading and clearly times have changed. Some universities are enjoying both not-for-profit status AND big business profits. The fact that they want to keep as much profits for themselves while shutting out others is a total greedy money grab which should not be allowed. Kick them really hard!

What reading?

Look, a university profits every time it sends an adjunct into a classroom of 50 students and pays that adjunct $2k for 4 months work.

50 students x tuition per course $1000 = $50000 - $2k = $48k profit.

Just because they make a profit there doesn't make the whole organization non-profit.

 

[geordi]

Not-for-profits are not in business to break even or to lose money. If they were, they'd be out of business quickly. I spent 42 years in the not-for-profit field. NFPs need profits too. Of course, in that business, we call it 'surplus.'

 

[Kolumbo]

What reading?

Look, a university profits every time it sends an adjunct into a classroom of 50 students and pays that adjunct $2k for 4 months work.

50 students x tuition per course $1000 = $50000 - $2k = $48k profit.

Just because they make a profit there doesn't make the whole organization non-profit.

The IRS would like a piece of the sports industry profits. If a coach makes $4 million per year, is that really furthering the education mission? Maybe. he's getting paid to make the sport more profitable, so let's call the business side of it what it is.

 

[upstater]

The IRS would like a piece of the sports industry profits. If a coach makes $4 million per year, is that really furthering the education mission? Maybe. he's getting paid to make the sport more profitable, so let's call the business side of it what it is.

He pays income tax, so they already have that piece. What other piece?

 

[Husky25]

The IRS would like a piece of the sports industry profits. If a coach makes $4 million per year, is that really furthering the education mission? Maybe. he's getting paid to make the sport more profitable, so let's call the business side of it what it is.

You're missing the point. How much a particular individual is paid is of no consequence to whether the organization is achieving its mission.

As has been said so eloquently before, Being a Not-for-Profit does not mean you cannot make a profit. Secondly, most school's athletic departments are loss leaders because the "Profits" generated by football and basketball fund swimming, Lacrosse, Baseball, tennis, track, etc. Any additional funding comes from other NFP foundations (See: The UConn Foundation), with rather loosely interpreted missions. The IRS would see little if any money from these "Profitable" programs because the departments in which they reside loses money year over year.

 

[Kolumbo]

He pays income tax, so they already have that piece. What other piece?

I'm not talking about a piece of the coach's income. I'm talking athletic department net income. Sports revenue further's the mission of the university, but if it is willing to slice out $4 million of revenue to pay a coach, that is more in-line with a business venture than educational. So let Texas pay some federal income tax and support those of us in the poor conferences.

 

[Kolumbo]

You're missing the point. How much a particular individual is paid is of no consequence to whether the organization is achieving its mission.

As has been said so eloquently before, Being a Not-for-Profit does not mean you cannot make a profit. Secondly, most school's athletic departments are loss leaders because the "Profits" generated by football and basketball fund swimming, Lacrosse, Baseball, tennis, track, etc. Any additional funding comes from other NFP foundations (See: The UConn Foundation), with rather loosely interpreted missions. The IRS would see little if any money from these "Profitable" programs because the departments in which they reside loses money year over year.

I am missing my own point?
My point is that some universities are very profitable and want to increase those profits through their sports programs, locking out other sports programs, etc. If greed is driving their quest for more profits, pays some taxes. That is my point.

 

[upstater]

I am missing my own point?
My point is that some universities are very profitable and want to increase those profits through their sports programs, locking out other sports programs, etc. If greed is driving their quest for more profits, pays some taxes. That is my point.

Any of these schools could show losses in sports quite easily the same way for profits do. Apple, INC., for instance didn't pay corporate taxes last year. You include the stadiums in the expense stream and you're done. Boom. And, if they go for-profit, then what do you do about the scholarships? Are they treated like air miles as perks?

 

[Husky25]

I am missing my own point?
My point is that some universities are very profitable and want to increase those profits through their sports programs, locking out other sports programs, etc. If greed is driving their quest for more profits, pays some taxes. That is my point.

You don't have a point. You are missing the point of Upstater,Geordi, and myself because you don't know (and are unwilling to learn) how a Not for Profit works...Do you understand that the IRS taxes profit and not Revenue? Do you understand the difference? These are honest to goodness questions, because from your posts, it doesn't seem like it.

Lets go through a simple math exercise.

By the way the parenthesis means a net loss

Sport.......................................Profit
Football.............................$1,000,000
Basketball (M/W)..................500,000
Baseball...................................(10,000)
Hockey (M/W)......................(200,000)
Cross Country (M/W)............(50,000)
Golf..........................................(75,000)
Soccer (M/W).........................(25,000)
Swim and Dive (M/W)...........(50,000)
Tennis (M/W).......................(100,000)
Track (M/W).........................(100,000)
Field Hockey..........................(50,000)
Lacrosse................................(200,000)
Rowing..................................(100,000)
Softball.................................(100,000)
Volleyball..............................(50,000)

Admin. expense....................(390,000)

Gross Athletic Dept. Profit.......-0-

Corporate Tax rate.............Whatever

Corporate tax liability.............-0- (Zero times whatever = zero, right?)

 

[Stinger92860]

What reading?

Look, a university profits every time it sends an adjunct into a classroom of 50 students and pays that adjunct $2k for 4 months work.

50 students x tuition per course $1000 = $50000 - $2k = $48k profit.

Just because they make a profit there doesn't make the whole organization non-profit.

Yesterday on Bloomberg TV there was a segment on Pharma and it was noted that some university research groups are returning nice profits for there institutions and growth is expected in this area.

 

[Kolumbo]

You don't have a point. You are missing the point of Upstater,Geordi, and myself because you don't know (and are unwilling to learn) how a Not for Profit works...Do you understand that the IRS taxes profit and not Revenue? Do you understand the difference? These are honest to goodness questions, because from your posts, it doesn't seem like it.

Lets go through a simple math exercise.

By the way the parenthesis means a net loss

Sport.........Profit
Football.........$1,000,000
Basketball (M/W)...500,000
Baseball..........(10,000)
Hockey (M/W).......(200,000)
Cross Country (M/W)..(50,000)
Golf.......(75,000)
Soccer (M/W).....(25,000)
Swim and Dive (M/W)......(50,000)
Tennis (M/W)........(100,000)
Track (M/W).....(100,000)
Field Hockey......(50,000)
Lacrosse.......(200,000)
Rowing.........(100,000)
Softball........(100,000)
Volleyball.....(50,000)

Admin. expense.....(390,000)

Gross Athletic Dept. Profit..-0-

Corporate Tax rate...Whatever

Corporate tax liability...-0- (Zero times whatever = zero, right?)

with all due respect, of course I understand. Let's just say all universities lose money as a whole on athletics. My point is that the greedy bastards at the schools bringing in the most revenue want more. You can set the tax however you like. Create a luxury tax on gross revenue, I don't care. If they want to continue to increase their revenues while unfairly shutting out the non-P5, make them pay. My mistake for using the term "profits."

 

[billybud]

Well...no problemo.

Down here in the southland, all football programs would immediately be registered as religious institutions...

 

[upstater]

Yesterday on Bloomberg TV there was a segment on Pharma and it was noted that some university research groups are returning nice profits for there institutions and growth is expected in this area.

A lot of the endowment at many universities is from patents and such. This has always been in the mix. Also, given the amount that schools take from research grants (60% of the grant) they can always adjust so as to never ever show profits.

Heck, sometimes these patents are given away for free (http://www.technologyreview.com/new...onal-transistors-went-from-lab-to-fab/page/2/) so it's hard to really ever put a value on the work done at these "non-profits" in terms of expense/revenue/profits.

 

[Husky25]

with all due respect, of course I understand. Let's just say all universities lose money as a whole on athletics. My point is that the greedy bas s at the schools bringing in the most revenue want more. You can set the tax however you like. Create a luxury tax on gross revenue, I don't care. If they want to continue to increase their revenues while unfairly shutting out the non-P5, make them pay. My mistake for using the term "profits."

You're getting off-base now...

To say nothing of the fact that the IRS has no jurisdiction in that area, to grant them any would take more time than anyone would think reasonable because it has to go through Congress. Representatives from the "Have" states (34, including California, Texas, Michigan, Ohio, and New York) are implicitly ok with how things are going and the Have-not states don't have the votes (Connecticut), clout (Idaho), or want-to (Everyone else) as a group to affect change...currently.

This Congress is the least productive in this country's 238 year history and you think taxing athletic programs because you don't think it's fair should vault to the top of the agenda. I disagree.

 

[Stray_Dog]

Reading this thread...I feel as though this whole thread is below valid justification pro or con, I mean really, just for profits versus for profit, with arguments about bringing the IRS in...it reads as though, two kids are about to get into a fight and one kid says, man when the principle gets here your going to get what you deserve, yet both kids would easily put there hands down, if they would just agree to share the cookie! SO can we please move onto better topics. GEESH...and for the record, next time I won't read this far down, I must have been REALLY REALLY Bored!