Jim Harbaugh expresses concern about prospect of NCAA players unionizing
"The one thing they probably need to look at is, if they are paid something and they become employees, there would be a real chance that they would be taxed, that their scholarship would be taxed as a taxable benefit," Harbaugh told reporters on the weekly Big Ten coaches conference call.
"I don't know if they've really looked at that and wondered if they might not be better off in a situation that they have (now). That's my question. The youngsters might be in a worse position if they're paid something, some amount of money and they become employees of the university."
October 7th, 2015 at 9:05 PM ^
October 7th, 2015 at 9:10 PM ^
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October 7th, 2015 at 9:13 PM ^
October 7th, 2015 at 9:28 PM ^
But wouldn't he also be technically subject to income tax on that income? I know in practice it doesn't happen, and I'm not an accountant or attorney nor do I play anything on TV...but would he?
Not supporting a side, just playing it out:
If student A gets income for _____ that income is subject to income tax.
If that income is from Univ Y for football, it is subject to income tax.
If that income is from selling Jordans on craiglist, it is subject to income tax.
In the first case it would be well-known and should likely be reported and paid.
In the second case it would be way under the radar and wouldn't be paid.
Not sure where I'm going here...feel free to neg or ignore.
October 8th, 2015 at 5:39 AM ^
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October 7th, 2015 at 10:33 PM ^
October 7th, 2015 at 10:35 PM ^
October 7th, 2015 at 11:12 PM ^
October 7th, 2015 at 11:17 PM ^
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October 8th, 2015 at 9:06 AM ^
who is the NCAA to say what is or is not fair value? The market is determined by what someone will pay, if someone wants to pay $10k for a $500 couch then it's a $10,000 couch. What you're basically saying is that a college athlete can sell anything they want so long as they're not making enough money to actually live on that income, which is bullshit infringement of their right to make a living, which courts incidentally hold to be a protected constitutional right.
October 8th, 2015 at 6:13 PM ^
No, if identical or very similar couches are being sold for $500 but that one got sold for $10,000, then it's a $500 couch. The same as how the government would have a big problem with you if you sold 10 used Chevys for $10,000 each and convinced a little old lady that the Chevy you're selling her costs $50,000.
October 7th, 2015 at 11:51 PM ^
like a Championship ring, or an award that was given to them?
October 8th, 2015 at 1:22 AM ^
In reality that doesn't seem fair to me even if it happened at OSU. If they won it its' theirs so why can't they sell it? They're perfectly free to sell if after they've declared for the NFL or their scholarship is up.
October 8th, 2015 at 7:24 AM ^
It isn't "fair," but it is necessary if you want to keep players from being paid by the boosters even more than they already are. The booster doesn't even need to pretend he isn't a bag man, he'll just say "sign with Ol Miss and I'll buy your sweatband for $10,000." College fotball would get pretty ugly with teams comprised of those who sell sweatbands for $10,000 and those who are just working their ass off for a scholarship and who are contributing just as much to the team, or more.
October 8th, 2015 at 8:53 AM ^
October 8th, 2015 at 5:38 AM ^
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October 7th, 2015 at 10:30 PM ^
What he "deserves" is to not possibly lose his scholarship if he, for example, has a coach help pay for a ticket home to attend a funeral, which used to be an NCAA violation, or selling basically anything on the secondary market even if it didn't come from the school.
October 8th, 2015 at 7:25 AM ^
It's probably good, then, that neither of those things is a violation.
October 8th, 2015 at 9:30 AM ^
October 9th, 2015 at 5:12 PM ^
The bigger point is that, if you want players to get paid for performing, you can watch the pros. Having college kids able to sell their services to bag men will lead to teams comprised of players making tens of thousands alongside those making nothing. That will ruin the whole team concept, and end college football as we know it.
I am all in favor of all athletes getting some pocket money/transportation money, to the tune of the suggested $5,000 a year or so. But it has to be all players, not just the ones perceived by boosters as "stars," and it has to be paid by the university, not the bag men. A little extra corruption isn't anything we should tolerate. And if college football goes effectively pro as you suggest, I think you will see people stop paying to watch it, since it will be inferior to its fellow-pro competition.
October 8th, 2015 at 12:08 AM ^
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October 8th, 2015 at 12:20 AM ^
It has been banned because if it were allowed, certain schools would set up situtations where players were paid thousands and thousands of dollars by boosters for their "signatures". Hell, Auburn would probably pay Cam Newton's dad about $200K for his son's "signature".
October 8th, 2015 at 12:53 AM ^
October 8th, 2015 at 7:26 AM ^
Emo much?
October 9th, 2015 at 7:14 PM ^
More like 20 minutes, in a week.
October 8th, 2015 at 11:17 AM ^
I never hear these kinds of objections raised when the schools and conferences come up with new ways to make money from the labor of these kids.
October 7th, 2015 at 9:25 PM ^
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October 8th, 2015 at 12:13 AM ^
I think what Coach Harbaugh is referring to is that if the revenue athletes become university employees (or even contract employees), room + board + tuition would be viewed as part of their compensation package, and thus be subject to state and federal income tax.
Averaging in-state + out-of-state costs from finaid numbers (27K + 51K), that is about $39K/year in income. Which would be around $5K in federal taxes, and about $1K in state taxes.
Would defer to any MGoAccountants, however. (Just an MGoTurboTaxer...)
October 8th, 2015 at 8:22 AM ^
They would have to redefine it as income. Right now you don't get taxed on the insurance premium your company pays for you but that is a huge benefit worth thousands of dollars each year. I would imagine that scholarships would remain untaxable, but the stipends and any "wages" would be taxed. Now the stipends add up to about 24K a year which with the EITC is hovering around paying no taxes at all.
October 8th, 2015 at 11:44 AM ^
Famous enough to sell autographs? Go right ahead, Mr. Manziel.
October 7th, 2015 at 9:09 PM ^
October 7th, 2015 at 9:09 PM ^
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October 7th, 2015 at 9:10 PM ^
October 7th, 2015 at 11:16 PM ^
Not on this.
In what world is not being paid better than being taxed for it? Enlighten me.
Let players make money off their likeness like every other student. How many players does this really benefit in the grand scheme of things?
October 8th, 2015 at 1:46 AM ^
October 8th, 2015 at 2:05 PM ^
To answer your question: the world in which the vast majority of their compensation is in kind (ie their scholarship), which would result in them having a substantial tax liability and no way to pay it since they were primarily not paid in money.So then it's the tax code that's the problem, not the very idea of dealing fairly and justly with people who provide a service from which others profit handsomely.
October 8th, 2015 at 5:37 PM ^
October 8th, 2015 at 9:55 AM ^
I think you misunderstood: Harbaugh is saying that if they are considered employees, and permitted to make some sort of salary/profit, then their in-kind benefits (scholarship, housing, food, etc) could be considered taxable income. For example, suppose that their scholarship and additional benefits are valued at $60k per year. And suppose they make an annual salary of $30k. They would have a taxable income of $90k, amounting to a tax liability of $31,500 (assuming 35% tax). In other words, they would be losing $1500.
So basically, it'll depend on the actual tax consequences, and the amount that each player would make.
October 8th, 2015 at 11:53 AM ^
Is it definitely true that the scholarship money would be treated as taxable income though? For other, non-athlete students who receive scholarships, if they get a job working for the university on the side, does their scholarship then also become taxable? My gut says no, but I don't actually know. Would love it if someone here could weigh in, because in this example if the non-athlete student employee isn't taxed on their scholarship I don't know why an athlete would be.
October 8th, 2015 at 2:02 PM ^
October 9th, 2015 at 3:23 PM ^
It's a good question, and I have no idea. Although, one thing worth noting is that non-athletic scholarships are typically based on something (need, academic achievement, etc.) and therefore are not directly related to any additional employment that student might secure with the University. By contrast, athletic scholarships are strictly for playing the sport. If athletics are treated as a form of employment, then an athletic scholarship would seem to be a direct benefit of employment.
October 7th, 2015 at 9:13 PM ^
October 7th, 2015 at 9:14 PM ^
October 8th, 2015 at 12:58 AM ^
October 8th, 2015 at 1:06 AM ^
No, Oaf, the terms and conditions on firing would be part of the bargaining agreement as it is in every union contract in world history.
And any scenario where the players were taxed on their scholarship would be taken into account in bargaining and salaries/compensation would have to cover enough to make it profitable enough over and above the tax money.
If the the rule is allowed to stand that puts age limits on hiring pro football players there is no way that requiring people to be enrolled in school, and therefore responsible for taxes on the scholarship would stand in court.
What happened to your precious "free" market? Why is restraint of trade for teenagers of legal working age who want to play pro football ok?
You can't not pay the employees in a money making operation. If Harbaugh wants to argue for amateur players but paid professional coaches and administrators and profiteering schools and athletic departments he has no legs to stand on.
If unpaid players are so important to him then he and everyone else should be ready to be unpaid volunteer coaches. No advertising on broadcasts and no charging for tickets or parking. Use volunteer staff.
The very fact that there is a cost of tuition in the US is a crime against humanity, and that it can be used as a bargaining chip/bludgeon in an argument against paying players in a hugely profitable scam, only because we have a corrupt non free/for profit anti democratic anti constitutional press is just furthering the crime sickeningly!
Gross.
October 8th, 2015 at 9:00 AM ^
I'm not sure if you've worked with Unions, but it can be very difficult to get rid of union employees. This would actually help players in the SEC who want to continue to play but are encouraged to leave. Gross misconduct wouldn't be tolerated, but that isn't anyway.
I think a 25 player max signing class with 100 max roster would also solve the first issue, and curb oversigning better thanthe union, but just saying. Even without a union, I've seen some pretty bad employees last for a long time. If it was considered paid, then the university would be responsible for paying unemployment to the student if he was "fired". It get's pretty messy.
October 7th, 2015 at 9:14 PM ^
October 7th, 2015 at 9:15 PM ^
Just stop making them pay for full ride scholarships for low interest sports. Title 9 is sexist.
October 8th, 2015 at 12:12 AM ^
I though Title 9 was supposed to get rid of the disparity in men's vs womens sports, therfeore, getting rid of sexism in athletic endowments.
Maybe someone with a better understanding of the law can explain this. It seems to that colleges can't have more men's sports than women's sports. However, it is okay for them to have more women's sports than mens. This does seem odd.
Or is it that if there is a sport that one gender plays there must be a corresponding opposite gender team (for example, if there is a baseball, then there must be a softball team)?
I can envision there being a women's gymnastics team at a school but not having a men's due to a much lower rate of participation in the men's version of the sport. Ia this why there are, generally, more women's sports than men's at universities?
October 8th, 2015 at 2:23 AM ^
Would it be fair if two women's sports bankrolled ever male sport? No, that would be sexist too. Men and women are different, despite some people's opinions.