College Athletes Beware: California’s Jock Tax — Already a Scourge of Professionals — Is Coming for You, Too

California’s “jock tax” has exploded into public consciousness in professional sports following reports that Seattle Seahawks quarterback Sam Darnold actually lost money after winning the Super Bowl at Levi’s Stadium in Santa Clara last Sunday. Now, the same tax structure is poised to impact college athletes thanks to a landmark ruling authorizing revenue sharing.A ruling by a federal judge last October in House v. NCAA cleared the way for schools to compensate athletes directly through revenue-sharing arrangements. Unlike NIL (Name, Image, and Likeness) deals, which are typically paid by third parties — revenue-sharing arrangements are tied directly to athletic participation. The revenue-sharing payments, introduced for the 2025-2026 school year, are widely expected to be treated as taxable wages, making them subject to state income tax and jock-tax laws.According to multiple reports, Mr. Darnold, and the rest of the Seahawks earned a $178,000 bonus for defeating the New England Patriots in the Super Bowl. But Mr. Darnold ended up with a California tax bill of approximately $249,000, leaving him $71,000 in the red.Mr. Darnold’s tax bill is based not just on the game itself, but “duty days,” the number of days spent practicing, training, meeting with the media and playing games in the state. Those days are then used along with an athlete’s entire season salary to come up with a final bill.For a player like Mr. Darnold, who makes more than $33 million per season, a few extra days in California can cost him a significant sum under the state’s 13.3% tax jurisdiction. Highly paid college athletes under a revenue-sharing arrangement will likely face similar consequences.A financial planner based in New Jersey, Andrew Nairooz, calls the jock tax “nonsense,” because it disproportionately penalizes athletes for simply doing their jobs in another state.“You don’t see accountants or consultants getting taxed separately in every state they travel to for work,” Mr. Nairooz tells the Sun. “Yet, athletes can be taxed for each game they play — on top of federal taxes and taxes in their home state. In high-tax states like California, that extra layer can be meaningful.”While Florida, Texas and Washington — states without a state income tax — avoid the issue, at least 40 states have a jock tax to amplify non-resident income. California has aggressively enforced its jock tax since the early 1990s, when the Chicago Bulls were taxed on their earnings during the NBA Finals against the Los Angeles Lakers.Since then, most states with professional teams, and some cities, have followed suit, creating a tax burden that is both punative and time consuming.“The administrative burden alone is excessive,” Mr. Nairooz says. “Professional athletes can end up filing tax returns in 15 to 20 states in a single season, and the cost and complexity of that eats into their earnings before they ever see the money.”Former NFL MVP Boomer Esiason suggested on his New York radio show that the NFL Players Association should refuse to play future Super Bowls in California, a suggestion that is unlikely to gain traction, considering Super Bowl LXI is scheduled for next season in Los Angeles.Like the NFL, the NCAA stages many of its most lucrative events at neutral site locations, including men’s and women’s basketball tournaments, the College Football Playoffs, and championship competitions in baseball, softball and other sports.Under a revenue-sharing model, college athletes could see a greater portion of their annual compensation apportioned to the states hosting those games.In California, the after-tax consequences could be significant. And unlike professional athletes, who are surrounded by agents, accountants and financial advisors, college athletes may not have the resources to anticipate the tax implications they could be facing.“Revenue sharing and NIL deals turned them into income earners almost overnight,” Mr. Nairooz says. “But most of them have little to no financial infrastructure around them. A 19-year-old playing an away game in California may not even realize he owes taxes there. Unfortunately, teenagers and young adults aren’t taught about taxes in ordinary curricula, and these aren’t average students.”The jock tax doesn’t only impact highly-paid star athletes — trainers, scouts, and lower-paid athletes often face the same tax issues despite earning far more modest incomes.When revenue sharing becomes normalized, college athletes looking to attend or transfer to certain schools will need to pay closer attention not just on how much they are paid but where they play.Mr. Nariooz, who works for A.P. Lubrano and Company, has seen an increase of college and even high school athletes calling for financial advice.“They’re earning real money for the first time without CPA’s, financial advisors or any real education around taxes, investing or long-term planning,” he says. “Without proper guidance they’re vulnerable to bad decisions or being taken advantage of before their careers even get started.”

College Athletes Beware: California’s Jock Tax — Already a Scourge of Professionals — Is Coming for You, Too

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