#NFL

Pittsburgh’s Jock Tax is Ruled Unconstitutional

Judge Rules Pittsburgh’s Facility Fee is a Violation of Pennsylvania’s Constitution and Prohibits the City from Collecting It This past September Judge Christine Ward struck down a fee levied by the City of Pittsburgh against visiting professional athletes’ wages, calling the fee an unconstitutional tax under Pennsylvania law. The ruling marks the third major defeat against a jock tax over the past decade as in April of 2014 Tennessee voted to eliminate their special tax for

Pittsburgh’s Jock Tax is Under Attack

Non-resident NHL players face five times the jock tax in Pittsburgh as compared to their resident counterparts This past November, the Players’ Associations from the NFL, NBA and NHL filed a lawsuit against the City of Pittsburgh claiming that the City’s Non-Resident Sports Facility Usage Fee is actually a tax. The lawsuit argues the “tax” unfairly proportions income and taxes non-resident athletes at a higher rate than those athletes who live in Pittsburgh. The lawsuit marks

Cousin’s Looks to Avoid the Jock Tax

Regardless of where Kirk Cousins signs this off season, it provides an example, once again on how the ‘jock tax’ can affect the net (take home) value of a contract. With Kirk Cousins set to become the first high profile quarterback to test the free agent market since Peyton Manning in 2012, his sights are likely set on Jimmy Garropolo’s $137.5 million contract. Should Cousins negotiate a similar structure to that of Garropolo’s contract, Cousins, simply due to the tax rate

Jock Tax Sacks Garoppolo’s New Deal

Jimmy Garoppolo’s five year, $137.5 million contract is being touted as the largest contract signed in National Football League (NFL) history, however a closer look at the contract indicates that it falls just short of David Carr’s and substantially below that of Mathew Stafford’s recently signed deals when comparing the the three contracts in terms of their true value. 49ers Avoid the “Kirk Cousins” Route In order to keep Garoppolo the 49ers had two distinct options. First,

Adding Insult to Injury

Introduction As Tom Brady leaves Minneapolis empty handed following a disappointing loss to the Philadelphia Eagles in Super Bowl LII (52), he soon could be met with a substantial tax bill from the State of Minnesota to be paid next April 15th. All athletes are subject to the jock tax, but it should be noted that this may not be a simple ‘jock tax’ scenario in which Minnesota can tax Tom Brady for his participation in Sunday’s game. The question that must be addressed is – c

Minnesota Eye’s Super Bowl Tax Prize

Introduction When taxpayers from Minneapolis and the state of Minnesota contributed $498 million of the $1.027 Billion to build US Bank Stadium, they envisioned days like Sunday, when the stadium will be the location of Super Bowl LII (52). However, the 66,665 fans in attendance and a worldwide television audience will not be the only ones watching the action on the field, tax authorities from the State of Minnesota will also be paying attention. The NFL and Jock Tax NFL pla

The New Tax Law and You

The end of 2017 has seen a flurry of activity as both the House of Representatives and the United States Senate passed tax reform Bills. Both Bills have been promoted as providing tax relief and simplification to individuals, small business and corporations. The House of Representative’s Bill entitled The Tax Cuts and Jobs Act was passed on November 16th while the US Senate’s Bill, which survived a vote of 51 to 49, passed on December 2nd. The two Bills have been combined in

Manning Retires with Two Last Victories

Peyton Manning is going out in style with two last wins. One over the Carolina Panthers in the Super Bowl and the other over the California Tax Board. Situation: This past off-season, Peyton Manning restructured his contract and converted a portion of his base salary into $4,000,000 in performance bonuses. By winning the Conference Championship ($2,000,000) and Super Bowl ($2,000,000), Peyton Manning earned an additional $4,000,000 in bonuses, in addition to the earnings all

California Eyes Super Bowl Tax Prize

Cam Newton eyes a Super Bowl ring while California has visions of taxing his salary. This Sunday at Levi Stadium in Santa Clara California, in addition to the 75,000 fans at the game and an expected television audience of over 188 million, the action on the field will also attract the attention of tax authorities from the State of California. JOCK TAX HISTORY Non-resident taxation on professional athletes gained national attention in the early 1990s as Illinois passed their r

Cleveland’s ‘Jock Tax’ Rejected

Former Indianapolis Colts lineman Jeff Saturday’s case against the City of Cleveland proves a cautionary tale to jurisdictions that reach beyond their constitutional rights. INTRODUCTION The United States Supreme Court’s decision to not hear Jeff Saturday’s case against the City of Cleveland is a significant victory for all professional athletes. Professional athletes face complicated tax issues, during the year at issue (2008) the Indianapolis Colts, Jeff Saturday’s employe

New Jersey Eyes Super Bowl Tax Prize

Peyton Manning eyes a second Super Bowl ring while New Jersey has visions of taxing his salary. This Sunday, fans of the National Football League (NFL) will not be the only ones paying attention to the players in this year’s Super Bowl. Tax authorities from the State of New Jersey will also be keeping a close eye on those individuals playing in Sunday’s game. States targeting non-resident athletes to increase tax revenues is nothing new. However, this could be a substantial a

California’s Tax Increase is not Par for the Course

Athletes consider alternatives as California’s latest tax increase is implemented In January, California increased its income tax rate by 2%—to 12.3%—for resident and non-resident individuals earning over $500,000. With California’s Mental Health Service Act imposing an additional 1% on individuals earning over $1,000,000, the state’s 13.3% income tax rate represents the highest of any state in the U.S. Prior to California’s tax increase, golfer Phil Mickelson created quite

Unsportsman-like Conduct

Jurisdiction’s income tax policies push athletes and Unions to fight back On February 4, 2007, in the biggest game of their respective lives, former Indianapolis Colt All-Star center Jeff Saturday and Hunter Hillenmeyer, a linebacker with the Chicago Bears, squared off against each other in Super Bowl XLI. Six years later, the two players now find themselves teaming up against the City of Cleveland for what they believe is an over-reaching of the city’s right to tax. In the

Is Tennessee’s Version of the “Jock Tax” Unconstitutional?

Authors Alan Pogroszewski and Kari Smoker examined this very question in their recent law review article and conclude that it is. Marquette Sports Law Review May 31, 2013 In July of 2009 the state of Tennessee imposed a Professional Privilege tax on athletes performing services in the NBA and NHL. Those athletes are assessed a $2,500 tax for each game they play, up to a maximum of three games in the state of Tennessee. In our article “Is Tennessee’s Version of the ‘Jock Tax

Fiscal cliff means higher taxes for athletes next year

Earlier this year, Federal Reserve Chairman Ben Bernanke stated, “Under current law, on January 1, 2013, there’s going to be a massive fiscal cliff of large spending cuts and tax increases.” The tax increases include cancelling the Bush era tax cuts of 2001 and 2003 which would increase the individual tax rate for those in the highest tax bracket from 35% to 39.5% and eliminate the payroll tax holiday, which would increase the payroll tax withholding from 4.2% to 6.2%. What d

Show me the Money

Week one of the National Football League (NFL) season means a bonanza of tax revenue for New Jersey As week one of the NFL concluded with 16 games in 15 states, it’s time to look at the tax ledger to see which states were the big winners. With states looking for ways to increase their revenues, non-resident professional athletes are an attractive target for state tax collectors. According to spotrac.com, the 2012 total NFL payroll for player salaries is just under $3.4 billio

Are Suspensions More Beneficial?

With the large fines being imposed by the National football League this past month as well as the talk of possible suspensions in the future for head-to-head tackles, I decided to review the tax implications for both fines and suspension to learn which scenario has the best tax consequence for athletes. This article will address two questions from an income tax stand point. First, how are fines and suspensions treated by the Internal Revenue Service [IRS]? Second, is there an