NFL Players Looking to Cut TaxesTax Professionals' Resource
September 18, 2013 — 2,014 views
Being a part of the National Football League means not just fame, but also lots of money. Not only the top athletes, but even the ones at the bottom of the squad get paid very well. Apart from this basic income, the biggies of the game also earn millions every year through their brand endorsements and promotions.
But just because they earn a lot more than the lifetime savings of average folks, it does not mean that all of it stays with them forever. They tend to lose an equally big amount of money in the form of taxes. Most of the professional players are actually the employees of the teams, which they represent on the field. So like any other normal employee, they too can subtract business expenditures that are not reimbursed as itemized deductions ,which are subject to 2% of their Annual Gross Income threshold. This means that if a player earns $2 million annually, his business expenditure should be more than $40,000 before he can get a tax benefit on the deduction.
Which Costs Can the Players Deduct?
- Agent fees
This fee is usually a part of the salary of the player. The maximum amount that any agent can charge under the contract of NFL is three percent. In case of any other income, the agent can charge a higher amount. No matter which kind of income it is, agent fees are always deductible.
Certified Public Accountant, Robert Raiola explained that fines that don’t violate any of the public laws can be generally deducted. For instance, if the player gets a speeding ticket while on his way to the game, it cannot be deducted. But if he gets fined for getting late to the game practice, it is deductible as it does not violate public law but violates the game policy.
- Ground Transportation
This includes traveling expenses like taxi fares, tolls, parking fees and so on that the player incurs due to his sport meets or events. All the traveling charges incurred by him while meeting the scouts, agents, trainers and other business related people are included in it.
- Non- Deductible Expenses
This includes personal items like jewelry, watches, electronics, and so on. Clothes which are not related to the game are also not deductible. Cell phones of the players are partially deductible. Gifts that the players receive are non-deductible, as long as they are not related to the game.