A state’s application of its income tax to nonresident professional athletes is referred to by some as a “jock tax.” The “jock tax” dates back to 1991 when California extended its state income tax to Michael Jordan and the rest of the Chicago Bulls after the Bulls beat the Los Angeles Lakers in the NBA Finals. Illinois retaliated the following year, and now twenty of the twenty-four states with professional sports teams levy some form of a “jock tax.” I bring up the “jock tax” because the NBA All-Star Game is tonight in Orlando, FL, which happens to be one of four states with professional sports teams that does not have a personal income tax. Last year I wrote a paper on the “jock tax,” describing how it works, peculiar approaches that states use, problems with the “jock tax,” and the approaches taken by states that do not have a personal income tax. The paper describes the benefit the players receive in playing in Florida tonight, along with some of the headaches faced by professional athletes in having to play games in so many taxing jurisdictions. I imagine the game will be that much better tonight since the players will not be worrying about being taxed as nonresident professional athletes in Florida.
