Falcons and Patriots Enjoy Tax Perks of Playing Big Game in Houston

Here’s something you might not know: Over 1.33 billion chicken wings and 49.2 million cases of beer will be consumed during this weekend’s championship football game. 

But what happens when the red-hot Atlanta Falcons and the experienced New England Patriots, a team that has played in a record 8 big games, go toe-to-toe in Houston Texas? We’re hoping it’ll be an epic game, but many players involved already have something to be thankful for, a bump in pay due to the big game being in Houston, and Texas doesn’t collect income tax.

Since pro athletes work in numerous states, they’re affected by each state’s different income tax level, which has affectively been termed the “jock tax”. That means that for every game they play in, they have to pay the income-tax rate of the state where the game is played. However players on the Atlanta Falcons and New England Patriots are in luck this year: everything may be bigger in Texas, except the taxes.

What does that mean for each player’s piggy bank? Each player on the winning team will be cut a $107,000 check by the NFL, while the losing team’s players will receive $53,000. Although Texas has no state income tax, Patriots and Falcons players who are residents of states with income taxes will still be taxed by those states as well as the federal government. This means Tom Brady, who reportedly is a resident of Massachusetts (5.1% state income tax rate), and Matt Ryan, who reportedly is a resident of Georgia (6% state income tax rate), will not receive a tax free check, just a slightly higher one than if the game were played in their home state or another state with a higher tax rate.

By comparison, last year’s Super Bowl was in the Bay Area, and many players had faced California’s top tax rate of 13.3% on their Super Bowl paychecks, so Brady and Ryan probably aren’t complaining about the change of venue.

The Pats and Falcons are also lucky they’re not playing in next year’s championship game scheduled to be played in Minnesota, which has a 9.85% income tax.

Like NFL athletes, many entrepreneurs hit new revenue strides and quickly find themselves the decision-makers of an increasingly intricate business playbook facing many additional tax “flags on the play”. We have yet to hear clients complain about quarterbacking in more money, but many soon come to see that having an expert advisory team can help avoid unnecessary fumbles and maximize growth. With a full playbook of services complimenting the needs of entrepreneurs and their closely-held businesses, Talley can offer you an accurate look at financial, tax and legal insights you need in order to call the best plays for you and your business.

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