World Cup prize tax has become the unexpected talking point after Spain won FIFA’s $50 million (around AED184 million) jackpot. While the trophy is heading to Madrid, part of the players’ bonus could end up with the US taxman.
NEW YORK: Winning the FIFA World Cup is supposed to be the happiest moment in a footballer’s career. But for Spain’s players, the celebrations could come with one unwanted guest… the US Internal Revenue Service (IRS).
After beating Argentina 1-0 in the final, Spain collected a record $50 million (around AED184 million) in prize money from FIFA. Sounds like the perfect payday, right? Not quite.
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Because the tournament was played in the United States, the World Cup prize tax rules kick in, giving the American government a chance to claim a share of the money.
Here’s the catch. FIFA didn’t hand the AED184 million directly to the players. The money went to the Spanish Football Federation, which will later decide how much each player receives as a bonus.
That part actually works in Spain’s favour. The federation could qualify for tax-exempt status in the US, meaning most of the prize money itself may avoid federal tax.
The players, however, don’t get the same deal.
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Once bonuses are paid, they are treated as income earned in the United States. That means the IRS can automatically withhold 30 per cent before the money even reaches the players.
The good news? That’s not always the final bill.
Many Spanish players are covered by a tax treaty between Spain and the US, which could reduce or even wipe out part of the federal tax. But there’s paperwork involved, and nobody enjoys dealing with tax forms after winning the biggest prize in football.
There’s another surprise waiting too.
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Even if players manage to lower their federal tax bill, they could still owe state tax because the final was played in New Jersey. The state doesn’t automatically follow international tax treaties and has a top income tax rate of 10.75 per cent.
Tax experts often call this the “jock tax“. In simple terms, athletes pay tax where they compete, not just where they live.
For fans, the story is a reminder that even a dream payday comes with strings attached. Winning the World Cup might make you a national hero, but it doesn’t stop the taxman from knocking on the door.
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The World Cup prize tax also shows something many ordinary workers don’t realise. Whether you’re a footballer, consultant or business traveller, earning money in another country can sometimes mean paying tax there too.
Spain may have lifted football’s biggest trophy, but when it comes to the prize money, the American government is also walking away with a slice of the action.
Babar Siddiqui is the Features Editor at TheBrewNews.com, where he covers stories spanning the environment, culture, and technology. A naturally curious storyteller with an adventurous spirit, he is passionate about exploring ideas that shape the world around us. Beyond the newsroom, Babar finds inspiration in nature, embracing its quiet moments as a source of reflection and creativity.
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