We take taxes seriously here at Sports Agent Blog, and agents across the board should do the same. A gross majority of professional athletes have not been schooled on foreign and domestic tax laws, and even if they were, they would not have the time to deal with the various matters that confront them with regards to taxes. Thus, as agents, it is important to either have the acumen to handle tax issues ourselves or find tax professionals who can assist athletes in complying with the law.
Here are some archived Sports Agent Blog tax related posts worth taking a look at:
- A Specific IRS Request For “Additional Information”
- Cliff Lee Thinking About Texas Taxes
- Did Taxes Have A Role In Cliff Lee’s Decision?
- Agent Fees Often Raise A Red Flag To The IRS
Recently, David Collier informed me of a new IRS rule that requires reporting of foreign bank accounts, which may affect American basketball and baseball players who are playing in a professional league overseas. Collier is a sports and entertainment attorney based in New York, New York.
The rule requires U.S. citizens who had foreign bank account(s), that combined exceeded $10,000 (or the equivalent of $10,000 in a foreign currency) at any point in time in 2010, to report the account(s) to the IRS.
Thus, even if the account(s) did not retain a balance of $10,000 throughout 2010, and even if on December 31, 2010, the account(s) had less than $10,000, so long as the foreign bank account(s) had $10,000 or more at any point of the year, those accounts must be reported. Importantly, account values are combined if the person had more than one account at any given time.
Many American athletes do not decide to open up bank accounts outside of the United States, but this piece of information is very useful to pass along to those who do elect to invest money into foreign bank accounts.