top of page

Taxes and Athletic Performance: Why NBA Players Perform Better in Low-Tax States

Professional athletes must pay state taxes to each state where their games are played.[1] With marginal state income tax rates ranging from 0% to 13.3%,[2] game locations can make a significant difference on a player’s after-tax earnings.[3] This is sometimes referred to as the “jock tax.”[4] For example, a player for the San Antonio Spurs who plays a game in California could pay up to a 13.3% California tax rate for that game (and there is talk of this being increased to 16.8%). But that same player who plays a game in Texas or Florida would not pay any tax, as those states do not have state income taxes. For some players, this means they would be able to keep thousands of dollars more for a game played in Florida than one in California. And changes to the tax code under President Trump make this disparity even greater because now the player cannot deduct the state taxes paid to California from his federal taxes.[5]

Extensive research has already been conducted regarding state tax rates and professional athletes. These studies conclusively show that athletes consider state tax rates when considering which team to join; that teams in high-tax states are therefore at a disadvantage in acquiring talent; and that because of this disadvantage, these high-tax teams underperform when compared to teams in low- and no-tax states.[6] These studies have analyzed European football, PGA golf, NBA basketball, MLB baseball, and NHL hockey.[7] However, no study has been conducted to measure how the various different tax rates experienced by professional athletes in their away games affect athletic performance. This first-of-its kind study fills this gap in the research. By using NBA free throws, a player’s performance can be considered in isolation without the interference of the opposing team, which would be present in every other NBA statistic. Therefore, this study also provides a valuable framework for analyzing mental states and athletic performance in athletes that can be applied in numerous applications in future research. Extensive research in sports psychology regarding how negative mental states produce diminished athletic performance infer that—if players are upset when a game results in a higher tax burden—then their athletic performance in those games would be diminished.

The results of this study confirm this hypothesis. Players averaged higher free-throw percentages in away games at no-tax states than they did in away games at high-tax states. This finding was well within the 0.05 statistical significance threshold with a p-value of 0.028. This finding provides empirical support for a number of topics that were previously discussed only theoretically. This invites future research into areas such as the far-reaching implications of tax policy, significance of sports psychologists, the importance of addressing mental states in athletes beyond just their past athletic performance, and the importance of team cohesion. Furthermore, the effects of mental states are likely applicable to the corporate world as well.[8] Therefore, this study invites future research into how mental states in general and state tax rates specifically might affect workplace performance, including collegiality, risk adverseness, discriminatory behaviors, and ethical corporate conduct. These issues are of increased importance in modern corporate America, where the ability of workers to telecommute is rapidly increasing.[9]

Future research could attempt to measure a similar effect in other sports that offer a frequent, uncontested circumstance during the competition. Potential examples include tennis serves, track and field performance, baseball pitches, PGA putting, WNBA free throws, and National Hot Rod Association drag racing reaction times. And there are other, related topics that could be researched. Because of how “duty days” are accrued,[10] are injured athletes more likely to come back into play at a low-taxed game? How are athletes in different states willing to trade off future salary for an upfront signing bonus—which could potentially be taxed at a lower rate?[11] How has the recent Supreme Court decision to allow collegiate athletes to profit from their name, image, and likeness affected their tax-avoidance behaviors and performance?[12] Has recent, record inflation affected the mental states of athletes who chose more money up front in the form of a signing bonus than at a later date in performance incentives? A qualitative survey of NBA players regarding their tax literacy would also provide valuable insight regarding this issue, as the notion that NBA players would surely be ignorant as to this relatively simple and highly significant concept of state taxes is perhaps rooted in latent racism.

This is a summary of a new study available in its entirety on SSRN at

Michael Conklin is the Powell Endowed Professor of Business Law at Angelo State University. He has published in over 100 academic journals including journals at 33 of the top 50 law schools. His research focus is expansive, but often centers on bridging the gap between theory and practice, providing valuable insight for policy makers, practitioners, and legal scholars. This focus on practical application has led to his placement as a top 100 author on SSRN.


[1] James Alm, William H. Kaempfer & Edward Batte Sennoga, Baseball Salaries and Income Taxes: The “Home Field Advantage” of Income Taxes on Free Agent Salaries, 13 J. Sports Econ. 619, 623 (2012). [2] Timothy Vermeer, State Individual Income Tax Rates and Brackets for 2023, Tax Found. (Feb. 21, 2023), [3] James Alm, William H. Kaempfer & Edward Batte Sennoga, Baseball Salaries and Income Taxes: The “Home Field Advantage” of Income Taxes on Free Agent Salaries, 13 J. Sports Econ. 619, 623 (2012). [4] Jared Walczak, Tyreek Hill Moved to Lower His States Taxes, and He’s Not Alone, Bloomberg Tax (Oct. 12, 2022, 3:45 AM), (explaining how some states allow workers to spend up to 30 days in the state before they have any income tax obligation there but that there are “jock tax” exceptions that preclude athletes from taking advantage of this). [5] Tax Cuts and Jobs Act of 2017, Pub. L. No. 115-97, 131 Stat. 2054. [6] See notes 9–22 of full document available at [7] Erik Hembre, State Income Taxes and Team Performance, 29 Int’l Tax & Pub. Fin. 704, 706 (2021). [8] See notes 43–46 of full document available at [9] The Number of People Primarily Working from Home Tripled Between 2019 and 2021, U.S. Census Bureau (Sept. 15, 2022), [10] See notes 28–29 of full document available at [11] Thomas Heath & Albert B. Crenshaw, In Professional Sports, States Often Claim Players, Wash. Post (Feb. 24, 2003), (“One way athletes can reduce their tax bill is to get as much money as possible up front in a signing bonus, and to receive that bonus as a resident of a tax-free state. If contracts are worded carefully, signing bonuses are not considered wages and an athlete can then avoid paying any state income tax, including the jock tax, on that money, agents say. The savings can reach hundreds of thousands of dollars for big-time players.”). [12] See Nat’l Collegiate Athletic Ass’n v. Alston, 141 S. Ct. 2141 (2021).

bottom of page