II 

113TH CONGRESS 

1ST SESSION S. 1524 

To amend the Internal Revenue Code of 1986 to exclude major professional 

sports leagues from qualifying as tax-exempt organizations. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 18, 2013 

Mr. COBURN introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to exclude 

major professional sports leagues from qualifying as taxexempt organizations. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Properly Reducing 

5 Overexemptions for Sports Act’’ or the ‘‘PRO Sports 

6 Act’’. 

7 SEC. 2. FINDINGS. 

8 Congress makes the following findings: 

9 (1) The National Football League (NFL), Na10 tional Hockey League (NHL), PGA Tour, and LaVerDate Mar 15 2010 01:25 Sep 21, 2013 Jkt 029200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1524.IS S1524

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1 dies Professional Golf Association (LPGA) each have 

2 league offices that are registered with the Internal 

3 Revenue Service as non-profit organizations under 

4 section 501(c)(6) of the Internal Revenue Code of 

5 1986. 

6 (2) League-wide operations of the NFL, NHL, 

7 PGA Tour, and LPGA generate an estimated $13 

8 billion in annual revenue, and these businesses are 

9 unmistakably organized for profit and to promote 

10 their brands. 

11 (3) Separate from their subsidiaries, the non12 profit league offices of the NFL, NHL, PGA Tour, 

13 and LPGA had annual gross receipts of $184.3 mil14 lion, $89.1 million, $1.4 billion, and $73.7 million in 

15 2010, respectively, for a combined total of over $1.7 

16 billion, according to each organization’s publicly 

17 available Form 990 filed with the Internal Revenue 

18 Service. 

19 (4) According to the Internal Revenue Service, 

20 section 501(c)(6) of the Internal Revenue Code of 

21 1986 is for groups looking to promote a ‘‘common 

22 business interest and not to engage in a regular 

23 business of a kind ordinarily carried on for profit’’. 

24 (5) According to the Internal Revenue Service, 

25 businesses that conduct operations for profit on a 


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1 ‘‘cooperative basis’’ should not qualify for tax-ex2 empt treatment under section 501(c)(6) of the Inter3 nal Revenue Code of 1986. 

4 SEC. 3. ELIMINATION OF SPECIFIC EXEMPTION FOR PRO5 FESSIONAL FOOTBALL LEAGUES. 

6 (a) IN GENERAL.—Paragraph (6) of section 501(c) 

7 of the Internal Revenue Code of 1986 is amended— 

8 (1) by striking ‘‘, or professional football 

9 leagues (whether or not administering a pension 

10 fund for football players)’’, and 

11 (2) by inserting ‘‘or’’ after ‘‘real-estate 

12 boards,’’. 

13 (b) EFFECTIVE DATE.—The amendments made by 

14 this section shall apply to taxable years beginning after 

15 December 31, 2013. 

16 SEC. 4. SPECIAL RULES RELATING TO PROFESSIONAL 

17 SPORTS LEAGUES. 

18 (a) IN GENERAL.—Section 501 of the Internal Rev19 enue Code of 1986 is amended— 

20 (1) by redesignating subsection (s) as sub21 section (t), and 

22 (2) by inserting after subsection (r) the fol23 lowing new subsection: 

24 ‘‘(s) SPECIAL RULES RELATING TO PROFESSIONAL

25 SPORTS LEAGUES.—No organization or entity shall be 


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1 treated as described in subsection (c)(6) if such organiza2 tion or entity— 

3 ‘‘(1) is a professional sports league, organiza4 tion, or association, a substantial activity of which is 

5 to foster national or international professional sports 

6 competitions (including by managing league business 

7 affairs, officiating or providing referees, coordinating 

8 schedules, managing sponsorships or broadcast sales, 

9 operating loan programs for competition facilities, or 

10 overseeing player conduct), and 

11 ‘‘(2) has annual gross receipts in excess of 

12 $10,000,000.’’. 

13 (b) EFFECTIVE DATE.—The amendments made by 

14 this section shall apply to taxable years beginning after 

15 December 31, 2013. 

Æ 


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