How much NBA players get taxed depends heavily on where their team plays, but on a $10 million salary, most players keep only $4 million to $6 million after federal income tax, Social Security and Medicare, state and city taxes, the road-game “jock tax,” league escrow withholding, and agent fees. Players in high-tax states like California and New York can lose more than 60 cents of every dollar; players on teams in Florida, Texas, or Tennessee keep noticeably more.
Federal Income Tax Takes the Biggest Share
The single largest deduction is federal income tax. The federal system is progressive: each additional dollar is taxed at a higher rate as income climbs through the brackets.1Office of the Law Revision Counsel. 26 U.S.C. 1 – Tax Imposed The top rate is 37%, and for 2026 it kicks in on single-filer income above $640,601. With the average NBA salary for the 2025–26 season near $12 million, virtually every player lands in that top bracket.
The lower brackets still apply to the first slice of income, but those amounts are a rounding error next to millions taxed at 37%. On a $10 million salary, a single player with no unusual deductions owes roughly $3.6 million to $3.7 million in federal income tax alone. Congress permanently extended these rates through the One Big Beautiful Bill Act, so the 37% top bracket is not going anywhere soon.
Social Security and Medicare
Every player also owes payroll taxes under the Federal Insurance Contributions Act. Social Security is 6.2% of wages, but only up to the first $184,500 in 2026.2Social Security Administration. 2026 Cost-of-Living Adjustment (COLA) Fact Sheet NBA players hit that cap in the first few days of the season and pay about $11,439 total.
Medicare tax has no cap. Players owe 1.45% on every dollar of salary, plus an Additional Medicare Tax of 0.9% on earnings above $200,000.3Internal Revenue Service. Topic No. 751, Social Security and Medicare Withholding Rates On a $10 million salary, that’s about $145,000 in regular Medicare plus roughly $88,200 in the Additional Medicare Tax. Combined with Social Security, total FICA runs about $245,000. Smaller than income tax, still real money.
State Income Tax Depends on the Team’s Location
Where the team plays changes the math dramatically. Nine states charge no personal income tax, including Florida, Texas, and Tennessee. That covers the Miami Heat, Orlando Magic, Dallas Mavericks, Houston Rockets, San Antonio Spurs, and Memphis Grizzlies. Players on those rosters owe zero state tax on their home-game earnings.
California sits at the opposite extreme. The top state income tax rate is 13.3% on income above $1 million, and California also collects a disability insurance payroll tax of 1.3% with no wage ceiling. That pushes the effective state burden on high wages to about 14.6%. A $10 million player with the Lakers, Warriors, Kings, or Clippers can owe well over $1 million in state tax on home-game pay alone.
New York is close behind. The state’s top rate is 10.9% on income above $25 million, and New York City piles on its own income tax reaching 3.876% for top earners.4Office of the New York City Comptroller. The NYC Personal Income Tax Before and After the Pandemic A Knicks or Nets player faces a combined state and city rate near 15%. Two players with identical $10 million contracts, one in Miami and one in New York, can see a difference of more than $1 million in take-home pay based on nothing but geography.
Federal law limits how much state and local tax a filer can deduct on the federal return, so players in expensive-tax states cannot fully offset those costs against their federal bill.
The Jock Tax on Road Games
Professional athletes deal with a wrinkle that almost no other worker faces: they owe state and local income tax in nearly every jurisdiction where they play an away game. The “jock tax” means each of an NBA player’s 41 road games triggers tax obligations in the state, and sometimes the city, where the game is played.
Most taxing authorities use a duty days formula. Divide the working days spent in that location (games, practices, required travel) by total working days in the season, then apply that fraction to annual salary. Three duty days in a city means that city taxes three days’ worth of the player’s contract.
Some cities charge on top of the state rate. Philadelphia levies a non-resident wage tax of 3.43%.5City of Philadelphia. Wage Tax (Employers) States with no personal income tax (Florida, Texas, Tennessee, Nevada, Washington) do not tax visiting athletes, so road games in those states are effectively state-tax-free.
Resident Credits and Filing Load
A player can end up filing income tax returns in 15 to 20 states each year, plus several municipalities. To avoid full double taxation, most home states offer a resident credit against home-state tax for taxes paid to away jurisdictions on road-game earnings. If the away state’s rate is lower than the home state’s, the player still owes the home state the difference. If the away rate is higher, the player usually cannot recover the excess. Players based in no-income-tax states benefit the most: no home-state tax to credit against, and they simply pay whatever each road jurisdiction charges.
The NBA’s 10% Escrow Withholding
The league’s collective bargaining agreement adds its own deduction. The NBA withholds 10% of every player’s gross salary and places it in an escrow account. The mechanism keeps total player compensation from exceeding the negotiated 51% share of Basketball Related Income, the pool that includes television deals, ticket sales, merchandise, and other revenue.
At the end of each season, the league compares actual revenue against total player salaries. If revenue is strong, players get their escrow money back. If salaries exceeded the players’ designated share, some or all of it goes to team owners instead. Returns swing hard by year: in the 2022–23 season players received nearly 100% of the withheld escrow, but for the 2024–25 season only 9% came back, meaning players effectively kept about 90.9% of their gross salaries that year.
On a $20 million contract, escrow ties up $2 million throughout the season. Even when the money eventually comes back, the player cannot invest or spend it in the meantime.
Agent Fees Come Out of After-Tax Money
NBA agents typically charge around 4% of a player’s contract. On a $10 million salary, that’s $400,000. Players also pay union dues to the National Basketball Players Association and cover financial advisors, personal trainers, and off-season training costs.
Before 2018, players could deduct many of those expenses as itemized deductions. The Tax Cuts and Jobs Act eliminated the deduction, and Congress made that change permanent.6Internal Revenue Service. Publication 529 (12/2020), Miscellaneous Deductions Agent commissions, union dues, and similar professional costs now come entirely out of after-tax dollars. A player in the 37% federal bracket who pays a $400,000 agent fee has to earn about $635,000 in gross salary just to cover it federally, and more once state tax is factored in.
Games in Toronto Trigger Canadian Tax
Every NBA team plays at least one road game per season against the Raptors, and income earned on Canadian soil is subject to Canadian federal and Ontario provincial income tax. Canada’s top federal rate is 33% on income above roughly C$258,000, and Ontario’s top provincial rate is 13.16% on income above C$220,000.7Canada.ca. Tax Rates and Income Brackets for Individuals Combined, the marginal rate for high earners tops 46%, higher than most U.S. jurisdictions.
The U.S.-Canada Tax Treaty and the federal Foreign Tax Credit prevent full double taxation. A taxpayer who pays foreign income tax can credit that amount against U.S. tax on the same income.8Office of the Law Revision Counsel. 26 U.S.C. 901 – Taxes of Foreign Countries and of Possessions of United States Because Canada’s rate exceeds the U.S. rate on that slice of income, the total tax on Toronto game earnings is essentially whatever Canada charged, with no extra U.S. federal tax on that portion.
What a $10 Million Player Actually Keeps
Stacking all of this together shows how far the gap between contract value and net pay can stretch. Compare two players earning $10 million in base salary for 2025–26, one in California and one in Florida:
- Federal income tax: roughly $3.65 million for both.
- FICA: about $245,000 for both. Social Security caps early; Medicare and the Additional Medicare Tax apply to all earnings.3Internal Revenue Service. Topic No. 751, Social Security and Medicare Withholding Rates
- State income tax on home games: about $1.3 million for the California player; $0 for the Florida player.
- Jock taxes on road games: both players owe in the states they visit, but the Florida player has no home-state tax to credit against, so those bills are a net addition. Totals typically range from $200,000 to $500,000 across a season.
- Escrow (10%): $1 million withheld for both, with the returned amount depending on league revenue.
- Agent fee (about 4%): roughly $400,000 for both, paid from after-tax income.
The California player’s total deductions run near $6.5 million to $7 million, leaving about $3 million to $3.5 million in real take-home pay, roughly 30 to 35 cents on the dollar. The Florida player keeps closer to $4.5 million to $5 million after the same federal taxes, FICA, escrow, agent fee, and road-game jock taxes. That gap of about $1.5 million per year, compounded across a four- or five-year contract, adds up to millions in lifetime wealth built on nothing but the team’s zip code.