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Do Nhl Players Pay Tax?


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#1 uber_pwnzor

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Posted 26 May 2012 - 11:39 AM

Basicly, yeah, do they? And if they do, how much? Don't you Canadians have higher income taxes than Americans?

#2 Shift-4

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Posted 26 May 2012 - 01:09 PM

Of course they do. They would be as much as anyone else making their kind of income (for the jurisdiction they live in).
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#3 Standing_Tall#37

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Posted 26 May 2012 - 01:16 PM

Canadian players playing in the states pay 50% tax. But some teams offer them tax incentives....ie: pay it for them or get a tax rate cut in order to attract free agents.

I know a guy that signed with the Thrashers about 4 years ago for $700,000. But he said right away you get deducted $350,000 and then the team charges you a fee on trainers,nutritionists, travel, lodging etc...then in his case he was up and down alot so he had to stay in hotels lots.

#4 *VaNcOuVeRCaNuCkS*

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Posted 26 May 2012 - 01:17 PM

Yep, it all depends on where they play and what they make

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#5 *VaNcOuVeRCaNuCkS*

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Posted 26 May 2012 - 01:17 PM

Canadian players playing in the states pay 50% tax. But some teams offer them tax incentives....ie: pay it for them or get a tax rate cut in order to attract free agents.

I know a guy that signed with the Thrashers about 4 years ago for $700,000. But he said right away you get deducted $350,000 and then the team charges you a fee on trainers,nutritionists, travel, lodging etc...then in his case he was up and down alot so he had to stay in hotels lots.


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#6 Hobble

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Posted 26 May 2012 - 08:44 PM

Not the ones with smart accountants...

#7 nuckin_futz

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Posted 26 May 2012 - 09:35 PM

Not the ones with smart accountants...


How exactly does a smart accountant help you when you're a public figure who's salary is common knowledge. Like CRA isn't going to suspect something is up when Henrik Sedin reports his income as 28k and requests a GST cheque.

#8 WHL rocks

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Posted 26 May 2012 - 09:41 PM

Not the ones with smart accountants...


How does a smart accoutant help you against paying tax?



#9 WHL rocks

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Posted 26 May 2012 - 09:54 PM

Canadian players playing in the states pay 50% tax. But some teams offer them tax incentives....ie: pay it for them or get a tax rate cut in order to attract free agents.

I know a guy that signed with the Thrashers about 4 years ago for $700,000. But he said right away you get deducted $350,000 and then the team charges you a fee on trainers,nutritionists, travel, lodging etc...then in his case he was up and down alot so he had to stay in hotels lots.


Quoted post is complete BS.

Income tax in the US varies from state to state. The federal tax remains the same but some states have higher income tax than others while some states don't have income tax at all ie: Florida

If a team pays part of a Players income tax such payment would be considered income and would be taxed as well as count against the cap.

Players don't pay for travel costs, nutritionists, training etc etc etc. all this is covered by the team. When in teams home city the player pays for his own living place but on the road all expenses are covered.



#10 etsen3

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Posted 27 May 2012 - 08:07 AM

Of course, why wouldn't they?

#11 The Wizard of AZ

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Posted 27 May 2012 - 09:15 AM

This thread reeks of Dan Ellis.


Canadian players playing in the states pay 50% tax. But some teams offer them tax incentives....ie: pay it for them or get a tax rate cut in order to attract free agents.

I know a guy that signed with the Thrashers about 4 years ago for $700,000. But he said right away you get deducted $350,000 and then the team charges you a fee on trainers,nutritionists, travel, lodging etc...then in his case he was up and down alot so he had to stay in hotels lots.


Rob Zepp.

Edited by The Wizard of AZ, 27 May 2012 - 09:16 AM.

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#12 RUPERTKBD

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Posted 28 May 2012 - 08:27 AM

Canadian players playing in the states pay 50% tax. But some teams offer them tax incentives....ie: pay it for them or get a tax rate cut in order to attract free agents.

I know a guy that signed with the Thrashers about 4 years ago for $700,000. But he said right away you get deducted $350,000 and then the team charges you a fee on trainers,nutritionists, travel, lodging etc...then in his case he was up and down alot so he had to stay in hotels lots.


If only this were true. We'd have Weber signed next year for sure.....
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#13 Prngr44

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Posted 28 May 2012 - 09:49 AM

I can imagine a pro sports players' tax return is a complete nightmare. Filing state taxes for every single state they play in as well as Canada. Some cities also charge additional tax. In St. Louis, if you have income based on business within the city you're subject to an additional 1% city tax on top of state and federal.
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#14 Lockhart

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Posted 28 May 2012 - 10:11 AM

Your in high school and you had to ask this question?......... :picard:

#15 Jester@wraiths.ca

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Posted 28 May 2012 - 01:12 PM

Canadian players playing in the states pay 50% tax. But some teams offer them tax incentives....ie: pay it for them or get a tax rate cut in order to attract free agents.

I know a guy that signed with the Thrashers about 4 years ago for $700,000. But he said right away you get deducted $350,000 and then the team charges you a fee on trainers,nutritionists, travel, lodging etc...then in his case he was up and down alot so he had to stay in hotels lots.


Completely and utterly wrong.

Like a person above said, each state has different tax laws. Texas for instance is one of the most favorable place for a player to play because the state has NO individual income tax. that doesn't mean no tax, just no tax for that particular thing, where most other states have a tax for that (usually 4-5%).

But overall, in the states, a person making millions averages around a 20% tax rate, though (this is where proper management comes in to play) with proper investment and use of their funds they can reduce that quite a bit as well...

#16 Argon

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Posted 28 May 2012 - 05:17 PM

that's the big draw for the KHL, not as much taxation
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#17 morrissex95

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Posted 28 May 2012 - 06:00 PM

I have no idea why the NHLPA takes such a large percentage a little under 10%. They've only got a small staff to fund and I don't think the NHLPA pays for agents. Very strange.
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#18 Standing_Tall#37

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Posted 28 May 2012 - 06:41 PM

Quoted post is complete BS.

Income tax in the US varies from state to state. The federal tax remains the same but some states have higher income tax than others while some states don't have income tax at all ie: Florida

If a team pays part of a Players income tax such payment would be considered income and would be taxed as well as count against the cap.

Players don't pay for travel costs, nutritionists, training etc etc etc. all this is covered by the team. When in teams home city the player pays for his own living place but on the road all expenses are covered.


Oh yes I completely made it up ....so your telling me a billionaire(team owner) has never struck a deal with a politician to make their business more successful(like attracting a star player to work for that business)
Look your obviously smarter than me so can you please post the section of the current cba that specifies where the salaries are gross or takehome and where it says the taxes can't be manipulated?. Thank you

#19 Rypien37

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Posted 28 May 2012 - 08:47 PM

Highest income tax bracket in Canada pays 40% in taxes.
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#20 Ghostsof1915

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Posted 29 May 2012 - 07:28 AM

Oh yes I completely made it up ....so your telling me a billionaire(team owner) has never struck a deal with a politician to make their business more successful(like attracting a star player to work for that business)
Look your obviously smarter than me so can you please post the section of the current cba that specifies where the salaries are gross or takehome and where it says the taxes can't be manipulated?. Thank you


Then you explain to me how the IRS in the US would allow that to happen. People think we're draconian here, you screw with your taxes in the US they play hardball. Big or small they will gladly seize assets. You may not pay as big a percentage in the US, but the IRS plays for keeps.
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#21 Prngr44

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Posted 29 May 2012 - 07:43 AM

Oh yes I completely made it up ....so your telling me a billionaire(team owner) has never struck a deal with a politician to make their business more successful(like attracting a star player to work for that business)
Look your obviously smarter than me so can you please post the section of the current cba that specifies where the salaries are gross or takehome and where it says the taxes can't be manipulated?. Thank you


The US goverment says taxes can't be manipulated.

Sure a business may strike a deal for certain incentives (reduces utilities, tax abatement, etc.) but they can't pass on any tax incentives to players just to play for their team. It's not their carrot to dangle.
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#22 PlayStation

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Posted 29 May 2012 - 07:55 AM

Well the NHL also has the Escrow

The NHL uses an escrow system. What is the NHL escrow system?

Players pay a percentage of their salaries from each paycheck to an escrow fund. This money is intended to cover any potential shortfalls in projected league revenue.

For example, if the NHL thinks it's going to make $2 billion in revenue, the salary cap will be based on that number. BUT if the league only ends up making $1.7 billion, there’s a $300 million shortfall. If there’s a shortfall, then the NHL takes the money from the escrow fund to make up the difference. However, if the league makes $2 billion, the players would get this money back.

In the early salary cap years, the league was growing so this money ended up being returned to the players, but with the economy being what it is, there's a chance the players may lose a chunk of their salaries.

The escrow payment has been set as high as 25% - that was in 2009. That meant that a quarter of each player's salary was held in escrow in case the money was needed to help offset shortcomings in the league's projected revenue.
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#23 avelanch

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Posted 29 May 2012 - 08:04 AM

Oh yes I completely made it up ....so your telling me a billionaire(team owner) has never struck a deal with a politician to make their business more successful(like attracting a star player to work for that business)
Look your obviously smarter than me so can you please post the section of the current cba that specifies where the salaries are gross or takehome and where it says the taxes can't be manipulated?. Thank you

the nhl collective bargaining agreement has nothing to do with the american or canadian tax code... even if it said the players will pay no tax they would still have to based on the tax code.

as for tax rules in the us, I don't know if there are special provisions for professional athletes, but for regular folk, you have to pay income tax based on where the work was performed, so the players would have to pay taxes in every state they played in, based on the portion of their salary they earned in each state.

#24 LostViking

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Posted 29 May 2012 - 08:10 AM

Not the ones with smart accountants...

This can be quite true. Income earned from NHL salary could easily be offset by an income loss, resulting in net zero taxes. A player who inherits a failing business (say by purchasing it for free), for example, would be quite well protected in certain instances. If that player wanted to then fold the business when he retires from hockey, to avoid having to pay out the debts the business owes, well that would be a shrewd move. This of course is muddied by varying laws across provinces, states, and the two countries involved. Sometimes it is not so simple to cancel out employment income with business loss, but other times it can be done.


I can imagine a pro sports players' tax return is a complete nightmare. Filing state taxes for every single state they play in as well as Canada. Some cities also charge additional tax. In St. Louis, if you have income based on business within the city you're subject to an additional 1% city tax on top of state and federal.

It is not very difficult to calculate such things. Income is earned daily by the player, it is easy to keep a record of where the team is each day, and which players are active and which are sitting at home injured.

It is just a matter of taking all the tax rates that apply, figuring out how many days they apply for, and prorating everything. A simple spreadsheet could handle this in a few minutes, of course you would have to understand enough tax law to apply the proper taxes and ignore the ones which don't apply.

Personally I don't know US tax law very well, there may well be provisions where NHL players are allowed to earn their income strictly in their home state. In other words, Detroit's players aren't being paid by Panther fans, they are being paid by the Red Wings who get their money (all earned in Detroit) by Red Wings fans attending Red Wing games, so even though they work sometimes in Florida, the actual product purchased by fans would be made in Detroit, the money made in Florida would go to Panthers players. I could see an argument either way, so I am not sure what the rules are. Either way, it wouldn't be that tough to calculate for someone of experience.

The US goverment says taxes can't be manipulated.

Sure a business may strike a deal for certain incentives (reduces utilities, tax abatement, etc.) but they can't pass on any tax incentives to players just to play for their team. It's not their carrot to dangle.


Not quite, there are work arounds for this sort of thing. The most basic being that if a player is to make 500k and worries he will lose half to taxation, the club could 'pay the tax' by giving him a 1M salary instead. This obviously would affect salary cap. The other obvious option is the illegal cash in a paper bag, I don't think that is a common NHL practice, but I assume its been done before. You can also work out a deal where the player would receive capital gains rather than income, this would likely be a deal involving the player returning to the team after retirement - and receiving some sort of stock that the team had been holding as a business investment. Capital gains are taxed much lower than income.

Edited by LostViking, 29 May 2012 - 08:11 AM.

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#25 avelanch

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Posted 29 May 2012 - 08:21 AM

Personally I don't know US tax law very well, there may well be provisions where NHL players are allowed to earn their income strictly in their home state. In other words, Detroit's players aren't being paid by Panther fans, they are being paid by the Red Wings who get their money (all earned in Detroit) by Red Wings fans attending Red Wing games, so even though they work sometimes in Florida, the actual product purchased by fans would be made in Detroit, the money made in Florida would go to Panthers players. I could see an argument either way, so I am not sure what the rules are. Either way, it wouldn't be that tough to calculate for someone of experience.

well I work in Washington (no state income tax) for a company based in Chicago (has a state income tax) and I pay no income tax because the work i perform is in Washington (but if i were to travel and perform work in different states i'd have to pay tax in those states). but like we both alluded to, there may be a provision in the us tax code that allows for athletes to be exempt from that type of state by state taxation (18 separate state tax returns). I'm just not sure about that.

Edited by avelanch, 29 May 2012 - 08:22 AM.


#26 Prngr44

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Posted 30 May 2012 - 08:35 AM

This can be quite true. Income earned from NHL salary could easily be offset by an income loss, resulting in net zero taxes. A player who inherits a failing business (say by purchasing it for free), for example, would be quite well protected in certain instances. If that player wanted to then fold the business when he retires from hockey, to avoid having to pay out the debts the business owes, well that would be a shrewd move. This of course is muddied by varying laws across provinces, states, and the two countries involved. Sometimes it is not so simple to cancel out employment income with business loss, but other times it can be done.



It is not very difficult to calculate such things. Income is earned daily by the player, it is easy to keep a record of where the team is each day, and which players are active and which are sitting at home injured.

It is just a matter of taking all the tax rates that apply, figuring out how many days they apply for, and prorating everything. A simple spreadsheet could handle this in a few minutes, of course you would have to understand enough tax law to apply the proper taxes and ignore the ones which don't apply.

Personally I don't know US tax law very well, there may well be provisions where NHL players are allowed to earn their income strictly in their home state. In other words, Detroit's players aren't being paid by Panther fans, they are being paid by the Red Wings who get their money (all earned in Detroit) by Red Wings fans attending Red Wing games, so even though they work sometimes in Florida, the actual product purchased by fans would be made in Detroit, the money made in Florida would go to Panthers players. I could see an argument either way, so I am not sure what the rules are. Either way, it wouldn't be that tough to calculate for someone of experience.



Not quite, there are work arounds for this sort of thing. The most basic being that if a player is to make 500k and worries he will lose half to taxation, the club could 'pay the tax' by giving him a 1M salary instead. This obviously would affect salary cap. The other obvious option is the illegal cash in a paper bag, I don't think that is a common NHL practice, but I assume its been done before. You can also work out a deal where the player would receive capital gains rather than income, this would likely be a deal involving the player returning to the team after retirement - and receiving some sort of stock that the team had been holding as a business investment. Capital gains are taxed much lower than income.


Where the hell are you coming up with this stuff??? :lol:

The tax returns would be a complete nightmare. I file 3 state returns and 1 federal return and it's a pain. Sure, I know that I made 10% of my annual income in this state, 15% in that state, and the rest in yet another state. It's still a royal pain to have to fill out 3 separate state returns and another federal.

Pro players would have to fill out a state return for every single state they play in. Spreadsheet or not it's a pain. The entire tax code in the US is a pain. Throw in another 25 or 30 states' worth of codes and it's no wonder why a player wouldn't want to TOUCH their returns.

Edited by Prngr44, 30 May 2012 - 08:36 AM.

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#27 avelanch

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Posted 30 May 2012 - 08:57 AM

Where the hell are you coming up with this stuff??? :lol:

The tax returns would be a complete nightmare. I file 3 state returns and 1 federal return and it's a pain. Sure, I know that I made 10% of my annual income in this state, 15% in that state, and the rest in yet another state. It's still a royal pain to have to fill out 3 separate state returns and another federal.

Pro players would have to fill out a state return for every single state they play in. Spreadsheet or not it's a pain. The entire tax code in the US is a pain. Throw in another 25 or 30 states' worth of codes and it's no wonder why a player wouldn't want to TOUCH their returns.

well every state except for Tennessee, Texas and Florida anyway... those are the 3 nhl states without individual state income tax. But people wonder why actors and athletes hire accountants to handle their taxes/funds; it's a complicated mess.

#28 WHL rocks

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Posted 30 May 2012 - 02:50 PM

Oh yes I completely made it up ....so your telling me a billionaire(team owner) has never struck a deal with a politician to make their business more successful(like attracting a star player to work for that business)
Look your obviously smarter than me so can you please post the section of the current cba that specifies where the salaries are gross or takehome and where it says the taxes can't be manipulated?. Thank you


Yes you completely made it up.





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