Pro Golfer’s tax rate for winnings is capped at 24%.

[Neodymium60]

Pro golfers winnings are considered by the IRS to be gambling winnings and therefore subject to the 24% rate.  (Federal).  In yesterday’s FEDX St Jude Championship in Tennessee the state has no income tax.

So Lucas Glover’s $3,500,000 1st place prize was taxed at $840,000 (24%).  Net $2,660,000.   And then there are deductions.

Pretty good deal for top pro golfers.  I wonder how long that has been in effect and how the IRS arrived at that.

 

[Mick1]

That’s just the amount withheld from the gambling winnings. Same is true for lottery winners. They still have to pay the normal federal IRS taxes at the regular tax rate.  Didn’t know that about pro golfer withholdings, though.

Audaces fortuna iuvat

[Neodymium60]

Curious.  You mean a Speith who makes 50 million+ of which 6-10 million of it is “gambling” is taxed on the other 40 mil less deductions at the normal rate?

This is an area that used to be known as “special taxpayers”.  A team pro sport athlete for example would not be considered earnings as gambling.  But has to pay the state income state tax where the game is played each game.   Just like an actor.

 

• This reply was modified 2 years, 8 months ago by Neodymium60.

[Mick1]

Lucas Glover has made $6.1 million this year so far, he’ll probably come in at $7 million+. The top tax bracket is $693,750 for married people. His federal tax rate is 37% for his marginal earnings. The government helpfully withheld 24% ($840k) of the $3.5 million first prize. He’ll still owe 13% more, or $455,000 on that prize.

Can’t speak to his state taxes. Any income he has in Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington or Wyoming isn’t taxed at all as those states have no personal income taxes. Golfers pay state income taxes on their earnings in the other 41 states.

 

Audaces fortuna iuvat

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