Potential New Broncos Owner Could Score Major Tax Breaks

A sale of the Denver Broncos could lead to billions in tax write-offs for the new owner.

The NFL team is widely believed to be approaching a sale, with former quarterbacks John Elway and Peyton Manning both reportedly interested. Robert F. Smith, who grew up in Denver, has also emerged as a potential bidder, and would be the NFL’s first Black owner, Front Office Sports reported last week. 

The team is currently owned by the Patrick D. Bowlen Trust. 

Over 90% of certain sports team properties, including player contracts, media rights, and trademarks, can be considered “intangible assets” and subject to write-offs over a 15-year amortization period.

• A ProPublica investigation found that Los Angeles Clippers owner Steve Ballmer paid a 12% tax rate on $656 million in income in 2017 and 2018 combined, largely due to amortized depreciation from his $2 billion purchase of the team in 2014. 
• Team owners Phillip Anschutz (Los Angeles Kings), Stan Kroenke (Los Angeles Rams, Denver Nuggets), and Daniel Devos (Orlando Magic) also reportedly paid less than 20% in taxes in those years.
• The report found that several NBA teams claimed over 90% of their value was in player contracts, which could be used for the owner’s tax benefit.

Biggest Team Sale Ever?

The team’s valuation, per Forbes, rose 17% to $3.75 billion in 2021, and a sale could reach $4 billion, sources told Front Office Sports in September, meaning tax write-offs could top $3 billion. 

The current record for a sports team sale is held by Joseph Tsai, who bought the Brooklyn Nets and Barclays Center operations for $3.3 billion in 2019.