The jock tax: one of the most odious taxes to come down the pike in a long time.
The tax that has been dubbed “Michael Jordan’s Revenge” as it was created after the Chicago Bulls beat the Los Angeles Lakers in the 1991 National Basketball Association championship. It was first instituted by the state of California in order to tax the income of professional athletes who work/play inside the state during the season.
The state of Illinois retaliated and instituted its own income tax targeted at residents of other states. And thus, we end up where we are today where over 20 states and plenty of cities have enacted so-called jock taxes.
Unfortunately, the tax does not just stop with multi-million dollar athletes, but now extends to non-residents with non-sports related income within a particular state. The tax and paperwork costs can be significant for any athlete from professional baseball players to skateboarders. And yet, you don’t even have to be a gym junkie as trainers, coaches, umpires, scouts, and now entertainers, lawyers, and accountants are feeling its pain.
The tax has found few friends as even the Tax Foundation has found it to be poorly targeted, arbitrary, and unfairly burdensome. So while you doctors, golfers, consultants, and pilots think you are off the hook at the moment you might just think again as the state of New York requires anyone file a return if you work just over 15 days a year in the state.