Jock tax

StateIncomeTaxRates2014

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Great professional athletes make a lot of money. In November slugger Giancarlo Stanton signed a thirteen year contract for over $325 million with the Miami Marlins!  Did you know that professional athletes have to pay an amazing amount of federal, state, and sometimes even city tax?
Since Stanton plays in Florida he pays the State of Florida at their state tax rate of 0%. So, over the next five years Stanton will pay no taxes to the state.  The state tax rates in Washington, Florida and Texas are 0%.  Basketball star DeAndre Jordan made news when he walked away from a verbal agreement with the Dallas Mavericks for $80 million over 4 years to return to the L.A. Clippers for $88 million over 4 years.  Considering California has a state tax rate of 13.3% and Texas has a 0% state tax rate which deal would have made him more money after state taxes?  

In this activity students consider the remarkable differences in state taxes that high paid pro athletes have  to pay and they determine how much more money an athlete should be paid in a high tax state in order to offset the taxes.  You might also consider showing part of this news clip that highlights the state tax story to you class.  Could make for some good math and social studies discussion.  Is this fair to teams that play in high tax states?

The Activity: JockTax-2015.pdf

For members we have a Word doc and solutions.

Jock-tax-2015.docx         Jock-tax-2015-solution.pdf

CCSS: 6.RP.3 , 7.RP.3 , 7.EE.3

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