MW The World Cup-winning side will make $50 million - and the IRS gets a cut
Andrew Keshner
'It doesn't make a difference who wins the game. The IRS will get a piece.'
Tax issues can become tricky for World Cup players.
The World Cup is the globe's largest sporting event - and, this time, it's also a major tax event for the IRS.
Ahead of the championship match between Spain and Argentina, there have already been some clear winners at the U.S.-co-hosted World Cup, ranging from Cape Verde's goalie to ranch salad dressing.
Put the IRS in the "W" column, too.
Massive cash winnings are at stake in the 48-country tournament. There are also sponsorship deals and paid appearances in play for established superstars and competitors with newfound fame alike.
Any money that's made on American soil, generally speaking, is taxable by the Internal Revenue Service, according to experts.
Either Spain's team or Argentina's will get the $50 million first-place prize from FIFA. That's just a sliver of the $655 million total pot for the competing national teams, depending on performance.
"It doesn't make a difference who wins the game. The IRS will get a piece," said Robert Raiola, director of the sports and entertainment group at the accounting and tax advisory firm PKF O'Connor Davies. That goes for the coaches, team staff and referees, along with players, he added.
On the tax-complexity scale, the World Cup ranks an 8 out of 10.Rob Fagan, KPMG
All the teams that participated and left with memories of being a part of the World Cup experience will also leave with a tax bill of some sort, he said.
No matter the sport, professional athletes always lead tangled tax lives. They play all over the world, in places with varied tax codes. Their compensation can hinge on meeting certain milestones, such as scoring a certain number of goals, which can make their income streams less predictable than a regular paycheck. They may be performing the work as an employee or as an independent contractor. Then they may have extra income from royalties, endorsement deals and other business arrangements.
The World Cup adds a slew of extra tax issues. For example, the U.S. may have tax treaties with certain countries, and these deals may feature carve-outs on money paid to athletes.
On the tax-complexity scale, the World Cup ranks an 8 out of 10, according to Rob Fagan, senior manager in KPMG's Washington National Tax, or WNT, practice. The firm has advised some national soccer federations on World Cup tax implications, he noted.
Big-time players will likely have an array of financial experts to help them navigate the tax maze, Fagan said. But players who are new to the tournament, and the global spotlight, "might be a little shocked," he said.
To be clear, FIFA doesn't directly pay the players on a World Cup team. Prize money instead goes to national football federations, which have their own rules and procedures for sharing the wealth with the players, managers, support staff and others.
Federation exemptions
The federations behind all the participating World Cup teams were poised earlier this year to become tax-exempt entities, according to an April report from the Guardian. FIFA itself has had tax-exempt status since 1994, according to the report.
FIFA did not immediately respond to a request for comment. The IRS and Treasury Department also did not respond to a request for comment.
But just because a soccer federation is tax-exempt, that doesn't mean the players, coaches or staff ultimately receiving the pay are exempt from U.S. taxes, said Fagan. That's a "common misperception," he said.
International tax treaties might block or reduce the amount owed to the IRS for income taxes and payroll taxes. A guiding principle of tax treaties is avoiding double taxation.
These international tax deals may include carve-outs for pay to foreign athletes and artists, Fagan said. Those carve-outs may depend on the money at stake. If it's above a certain level, the whole amount can be subject to U.S. tax, he noted.
The U.S. has a tax treaty with Spain but not with Argentina, according to an IRS database. The two countries are slated to play in the World Cup final on Sunday at 3 p.m. Eastern time in East Rutherford, N.J. France and England play Saturday at 5 p.m. in Miami for third place.
'Even within the same team, there may be different tax answers for different players. You have to go through and look [at] your entire entourage.'Christopher Hall, PKF O'Connor Davies
Christopher Hall, a director in the international tax group at PKF O'Connor Davies, said the tax complications for football internationals can be head-spinning. For example, if a player lives in the country where his club is based but then is selected for his home country's national team, questions may arise over which, and whether, tax-treaty terms apply. Meanwhile, treaty terms could cover the pay to athletes but maybe not the team's medical staff.
"Even within the same team, there may be different tax answers for different players," said Hall, later adding, "You have to go through and look [at] your entire entourage."
Last month, the IRS announced it had reached a consensus with its counterparts in Canada and Mexico, World Cup co-hosts this year. The three tax authorities essentially determined how to identify how much of the money counted as U.S.-sourced income and how much counted as Mexican- and Canadian-sourced income.
The IRS's National Taxpayer Advocate followed with a "tax playbook" for the World Cup's foreign participants, including players, coaches, staff, media personnel and businesses spending time in the U.S. during the 39-day global event.
It went through a roster of forms and rules they needed to consider. It ended with one tip: Find a professional to help. "The U.S. tax system can be complex, especially for international taxpayers."
Some states are also getting a cut, thanks to 'jock taxes'
Federal taxes are one part of the play. State income taxes are a different story.
Across nine states, 11 U.S. cities hosted 78 games. Three of those nine states - Texas, Florida and Washington - do not levy their own income taxes.
Enter the "jock tax."
When someone makes money in one state but lives in another, they are generally subject to income tax in the state where they made the money, Raiola said. The money might be credited back to the taxpayer, depending on rules and agreements between states.
Professional athletes are high-profile taxpayers making a lot of money, said Raiola. State tax authorities know when they are there - and they are making sure the players get billed. It's a consequence of being well-known and well-paid for playing a sport at a high level.
That's the "jock tax," Raiola said. "It's the just [a] slang term [for] paying tax in another state."
Sunday's championship is being played in New Jersey, which has an income tax. Plus the Garden State does not follow international tax treaties, Fagan noted.
New Jersey's taxman will be watching the Spain-Argentina square-off, Raiola said. "I can tell you for sure they are paying tax on that game."
-Andrew Keshner
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July 17, 2026 19:05 ET (23:05 GMT)
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