It Pays To Be a Professional Athlete
“Nothing is certain except death and taxes”… and more taxes, if you’re a professional athlete. The “Jock Tax” is an income tax levied against visitors to a city or state who earn money in that jurisdiction. For example, last May, Pittsburgh Pirates star Andrew McCutchen paid the state of Missouri, and the city of St. Louis, a combined $11,400 for the three game road trip, in which the Cardinals won all three games.
Originating in 1991, California imposed this new tax on the earnings of Chicago Bulls players who traveled to Los Angeles to play the Lakers. Illinois soon retaliated, imposing its own tax on out-of-state players. By 2014, 22 of the 26 jurisdictions with professional sports teams enforced this tax.
Most jurisdictions calculate jock taxes by measuring “duty days.” This means taking the number of workdays spent in the state, including practice days, divided by the number of workdays in the season, generally including preseason.
Athletes are targeted for two reasons. First, their yearly salary is easily accessible online. Second, their season schedule can also be found online within seconds. This allows jurisdictions to calculate the tax using minimal effort. However, when other businessmen or women travel for work, they are not taxed for their short term visits.
The Tax Foundation has stated it is poorly targeted, arbitrarily enforced, and unrealistically burdensome to athletes. Hopefully, major revisions can be made to eliminate some of these burdens, but for now, we can be thankful our daily schedules are not public knowledge.