Pro athlete income taxes
In a discussion on the Sharks list about a prospective NHL expansion/relocated team in Seattle, someone noted "This brings to mind Seattle's situation, which has pretty bad traffic, actually, but that's offset by having no income tax. I don't think they'll have any difficulties signing free agents!"
Which I was pretty sure wasn't much of a factor since don't states require you to pay income tax on income earned from sources within that state, at least roughly speaking?
Google turned up this article:
Athletes file taxes not only in their home state but also in every state -- and some cities -- in which they play. Not every state uses the same calculation to determine what portion of an athlete's income to tax, and some use different calculations based on the sport. [...]
Reciprocity agreements can save an athlete thousands if their tax professional knows what to look for. For example, a Pennsylvania resident whose tax rate is 3.07% is exempt from paying taxes on money earned in [NJ, WV, OH, MD, VA, IN]. Because players come from all over and move around so much an athlete's team will often times report income and withhold taxes in every state he plays, regardless of whether a reciprocity agreement with his home state is in place.
There are some other minutiae; this is all fascinating in a sick sort of way.
rcfox, do you handle any pro athlete returns?
Which I was pretty sure wasn't much of a factor since don't states require you to pay income tax on income earned from sources within that state, at least roughly speaking?
Google turned up this article:
Athletes file taxes not only in their home state but also in every state -- and some cities -- in which they play. Not every state uses the same calculation to determine what portion of an athlete's income to tax, and some use different calculations based on the sport. [...]
Reciprocity agreements can save an athlete thousands if their tax professional knows what to look for. For example, a Pennsylvania resident whose tax rate is 3.07% is exempt from paying taxes on money earned in [NJ, WV, OH, MD, VA, IN]. Because players come from all over and move around so much an athlete's team will often times report income and withhold taxes in every state he plays, regardless of whether a reciprocity agreement with his home state is in place.
There are some other minutiae; this is all fascinating in a sick sort of way.
rcfox, do you handle any pro athlete returns?