Poker NewsMuch more than just a poker blog...
The WSOP Main Event finalists living in London have saved $9.55 million total in taxes, the American players pay at least 40% of their winnings. Russ Fox from Clayton Financial and Tax has been writing reports about the taxation of the WSOP winners for years, and you can read the shocking excerpt from this years report below.
In the report, Fox calculates the amount of taxes each player has to pay, and how much they would have to pay if they lived in their native country.
Martin Jacobson, the new WSOP champion won exactly $10 million in the tournament. The Swedish pro lives in London, if he lived in Sweden, the Skatteverket, the Swedish equivalent of the IRS, would have imposed a tax of around 56%, or $5.6 million on his winnings.
Felix Stephensen, who finished as the runner-up, received $5.1 million, and the Skatteetaten, the Norwegian IRS would put a 39% tax on his winnings, which is more than $2 million, but he, as well as Jacobson and third place finisher Jorryt van Hoof, lives in London.
Van Hoof won $3.8 million, and he would have to pay 29% taxes, more than $1.1 million. Even though van Hoof saved a lot of money by living in London, the Kansspelautoriteit, the gambling regulator in the Netherlands, has declared that any company sponsoring van Hoof would still be violating the Dutch advertisement rules. It is unknown how much money van Hoof lost by this decision, but it was rumored that 888poker, who sponsored three other players at the WSOP Main Event final table, was ready to sign the online PLO specialist.
Fourth place finisher William Tonking won $2.8 million, but he has to pay $1.1 million to the IRS and $242,000 to the New Jersey Division of Taxation, which in total is 46% of his winnings.
Moving to London would not solve Tonking's tax issues, because as an American, he owes tax on his worldwide income.
Billy Pappas finished in fifth place, he won $2.1 million, from which he has to pay about $770,000 to the IRS, as well as $111,000 to the Massachusetts Department of Revenue.
Andoni Larrabe won $1.6 million for his sixth place finish, but like the top three, he also lives in London, so he gets to keep all of his winnings. In Spain he would have to pay 52% tax on his winnings, but like this, he actually made more money than fourth place finisher William Tonking.
Dan Sindelar won $1.2 million with his seventh place finish, he has to pay around 40% ($494,000) to the IRS, but at least he doesn't have to deal with the Nevada authorities (there is no state income tax).
Bruno Politano won $947,000, and in accordance of the US-Brazil Tax Treaty, he has to pay around 30%, or $284,000.
Since players receive the money for the ninth place when they reach the final table, ninth place finisher Mark Newhouse did not receive any extra money, but has to pay 44%, or around $324,000 on his winnings from July.
From the $28.5 million that was paid out at the final table, players will pay around $3.3 million in taxes, which equals an 11.6% tax rate. The IRS will receive $2.86 million from this, and the only reason they are not the biggest winners of the tournament is because four of the nine players live in London.
With the $2.86 in taxes, the IRS is the fourth biggest winner of the tournament, while the players living in London saved a total of $9.55 million in taxes.