A note on pro athletes taxes.
Reader comment on: Mickelson's Math
Submitted by Lyle (United States), Feb 6, 2013 00:15
They pay taxes in every state they compete in that has an income tax as do NBA and NFL players. The other states taxes go as credits against the state income tax. Because the state tax people can see schedules and who wins it's not so much where you live but where the competition is. In one sense then moving to NV where there is no income tax would not reduce his tax bill as much as it would appear at first glance. Here is a an article from the LA times on the Jock tax. http://articles.latimes.com/2009/apr/12/sports/sp-jock-tax12. Note however the pro golfers really play as a corporate form, where the corps file the state income tax returns. The individual pays the taxes on salary and dividends.. So I doubt that Mickelson really gets $45 million in salary and bonuses, it is his corp that does so and then pays all the expenses such as lodging and travel for Phil . A golfer on a lower level had about 30% of income diverted to expenses. So Phil's situation is far too complex for most to understand that reporters could not write a clear explaination of it for the public.
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