Salaries, royalties and "swag" are usually the biggest pieces of the pie when it comes to the total incomes of basketball players. It's really important to keep track of income streams to make sure you're actually getting access to what's owed to you. In addition, knowing exactly what's coming in from different sources will ensure that you don't end up past the IRS's foul line.
Are You Exploring Tax Planning For Basketball Players?
One of the first realities that may cause you to seek out a serious tax plan is something called the "jock tax." This little rule requires players to report income in every state they play in during a single year. Moves, trades and other developments can cause this tax to play a big role in your overall tax strategy.
The list of tax considerations for a basketball player is long. For instance, the IRS will probably want to tax you on any free gifts or "swag" that you receive for personal or promotional purposes. You also have to take a close look at how to handle any signing bonuses that come your way. The way a bonus is paid out to you may determine whether or not it’s considered state income.
Being tax savvy isn't just about knowing how much to pay the IRS. It also involves knowing how to keep more of your money through strategic and legitimate deductions. A lot of the gear and equipment you use for training purposes can actually qualify as tax-deductible items. It's also useful to take a close look at how to maximize your charitable deductions to ensure that you're making the most out of giving to the organizations that are near and dear to your heart.
It's really essential to revisit your tax strategy if it's been a few years since you last consulted with financial advisers for professional basketball players. Much of the advice that a CPA for pro basketball players may have given you a few years ago is now outdated due to recent changes in tax laws. For instance, union dues and agency fees related to W-2 income don't qualify for itemized deductions like they did up until 2018. Don't risk missing out because you're playing by last year's tax rules this year.
Accounting For Professional Basketball Players Done Right
You probably don't wear the same size jersey as the teammate standing next to you. Similarly, you probably don't require the exact same CFO advisory for professional basketball players. That's where our team of dedicated accountants can assist. We, at Fusion CPA, can help you handle accounting for your professional basketball career based on your stats. Furthermore, where you play, the level you play at and your dreams for the future will all help to determine the style of CFO advisory we provide to you because CFO advisory for professional basketball players varies from player to player.
We understand your profession and our team of experienced accountants are ready to help you build long-term value in your career. You can learn more about our services by clicking the button below to schedule a complimentary discovery call today!
This blog article is not intended to be the rendering of legal, accounting, tax advice or other professional services. Articles are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes. We expressly disclaim all liability in regard to actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive