Show me the Money

Week one of the National Football League (NFL) season means a bonanza of tax revenue for New Jersey

As week one of the NFL concluded with 16 games in 15 states, it’s time to look at the tax ledger to see which states were the big winners.

With states looking for ways to increase their revenues, non-resident professional athletes are an attractive target for state tax collectors. According to spotrac.com, the 2012 total NFL payroll for player salaries is just under $3.4 billion or a weekly  average of $212,432,161.  And athletes follow a predetermined schedule that makes it easy for states to determine the apportionment of income earned in each of their jurisdictions.

By hosting two games during opening week at Met-Life Stadium in East Rutherford, (the Giants hosted the Dallas Cowboys on Wednesday and the Jets faced the Buffalo Bills on Sunday), New Jersey more than doubled the second closest state in revenue collected. With all four teams having a payroll over $100 million and a personal income tax rate of 8.97%, the state collected $2,464,316.44 in ‘jock tax’ revenue from both resident and non-resident athletes performing services in their state.

No other states exceeded the two million dollar threshold, but three other states exceeded one million in tax revenue collected: Wisconsin which will collect $1,116,643.60 as the Packers hosted the San Francisco 49ers, California collecting $1,084,176.64 with interstate rival Oakland playing San Diego, and Minnesota receiving $1,039,847.90 with the Vikings hosting the Jacksonville Jaguars.

Of the 15 states where games were played over the first week, California has the highest tax rate (9.3%) and Tennessee, Texas, and Florida, do not tax personal income at all.

In total, the 12 states that tax personal income generated $11,174,213.32 of tax revenue during week one of the NFL season.  Of that amount, $5,238,000.17 or 46.88% was earned in ‘jock tax’ revenue by taxing non-resident athletes who performed services in their state.

ALAN POGROSZEWSKI is an Assistant Professor of Sports Studies at St. John Fisher College and the President of his own tax consulting business. His clients include professional athletes performing services on three continents. Prior to joining St. John Fisher College, Mr. Pogroszewski was the Vice President of Business Operations for Sports Consulting Group, specializing in the representation of professional hockey players. Mr. Pogroszewski received his M.B.A. from Rochester Institute of Technology in 1996 and his M.S. in Taxation from St. John Fisher in 2003

Tags: AFP Consulting, AFP Consulting LLC, AFP Tax, AFP Tax Consulting, Alan Pogroszewski, athlete tax, athletes, Football, income tax, jock tax, NFL, personal income tax, professional athlete tax, salary, sport tax, sports tax, Team taxes