[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 3086 Introduced in Senate (IS)]

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115th CONGRESS
  2d Session
                                S. 3086

      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

                             June 19, 2018

 Mrs. Ernst (for herself and Mr. King) 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 tax-exempt 
                             organizations.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Properly Reducing Overexemptions for 
Sports Act'' or the ``PRO Sports Act''.

SEC. 2. FINDINGS.

    Congress makes the following findings:
            (1) The National Hockey League (NHL), PGA Tour, and Ladies 
        Professional Golf Association (LPGA) each have league offices 
        that are registered with the Internal Revenue Service as 
        nonprofit organizations under section 501(c)(6) of the Internal 
        Revenue Code of 1986.
            (2) League-wide operations of the NHL, PGA Tour, and LPGA 
        together generate over $1,000,000,000 in annual revenue, and 
        these businesses are unmistakably organized for profit and to 
        promote their brands.
            (3) According to the Internal Revenue Service, section 
        501(c)(6) of the Internal Revenue Code of 1986 is for groups 
        looking to promote a ``common business interest and not to 
        engage in a regular business of a kind ordinarily carried on 
        for profit''.
            (4) According to the Internal Revenue Service, businesses 
        that conduct operations for profit on a ``cooperative basis'' 
        should not qualify for tax-exempt treatment under section 
        501(c)(6) of the Internal Revenue Code of 1986.

SEC. 3. ELIMINATION OF SPECIFIC EXEMPTION FOR PROFESSIONAL FOOTBALL 
              LEAGUES.

    (a) In General.--Paragraph (6) of section 501(c) of the Internal 
Revenue Code of 1986 is amended--
            (1) by striking ``, or professional football leagues 
        (whether or not administering a pension fund for football 
        players)'', and
            (2) by inserting ``or'' after ``real-estate boards,''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2018.

SEC. 4. SPECIAL RULES RELATING TO PROFESSIONAL SPORTS LEAGUES.

    (a) In General.--Section 501 of the Internal Revenue Code of 1986 
is amended by adding at the end the following new subsection:
    ``(s) Special Rules Relating to Professional Sports Leagues.--No 
organization or entity shall be treated as described in subsection 
(c)(6) if such organization or entity--
            ``(1) is a professional sports league, organization, or 
        association, a substantial activity of which is to foster 
        national or international professional sports competitions 
        (including by managing league business affairs, officiating or 
        providing referees, coordinating schedules, managing 
        sponsorships or broadcast sales, operating loan programs for 
        competition facilities, or overseeing player conduct), and
            ``(2) has annual gross receipts in excess of 
        $10,000,000.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2018.
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