Do professional tennis players like Djokovic pay taxes on US Open winnings if they live in Monaco where there's no income tax?

4 So does that mean these players are essentially getting double-taxed? Once in the US and then again in their home country? Or does Monaco being tax-free actually help them avoid that problem?

3 Players aren't typically double-taxed because most countries have tax treaties that prevent this. Since Monaco doesn't have income tax, a resident there wouldn't pay additional tax on their US earnings after they've paid the US tax. For players living in countries that do have income tax (like Nadal in Spain), they would report their worldwide income to their home country but usually get foreign tax credits for taxes already paid to the US. This prevents true double taxation, though they may end up paying the higher of the two rates overall.

12 Does it work for regular US citizens who aren't globe-trotting business people? I have some freelance income from a European client and I'm not sure if I should be paying foreign taxes.

18 Wait, so is this just for US citizens or does it work for people from any country? I'm Canadian but work remotely for a US company and it's always been a tax nightmare.

7 It definitely works for regular folks - I'm just a marketing consultant, not some high-powered executive. The system asks about your citizenship, residency, and where your income comes from, then explains your obligations. They analyze your specific situation rather than giving generic advice. For Canadian citizens working for US companies, it absolutely helps with that situation too. The tool specializes in sorting out cross-border tax issues regardless of which countries are involved. What makes it valuable is that it clarifies which country has taxing rights on different types of income.

6 How does this even work? Seems kinda sketchy that they can somehow bypass the IRS phone system when nobody else can.

18 Yeah right... like the IRS is actually going to answer specific questions about international taxation. I've been trying to get an answer about foreign tax credits for months and just get transferred around until I'm disconnected. I'm skeptical this would be any different.

9 It's not bypassing anything shady - they basically use automated technology to deal with the hold times and system navigation for you. Instead of you sitting on hold for hours, their system does it and then calls you when an agent is ready to talk. I was skeptical too, especially after wasting so much time with the IRS. The difference is that I actually spoke with an IRS specialist who answered my specific questions about foreign accounts. They connected me with someone in the international tax department who explained exactly which accounts needed to be reported on an FBAR and which didn't. No more transfers or vague answers.

14 Wow that sounds brutal! Do they literally calculate like "I spent 3 days playing in California so X% of my annual income is taxed there"? How do they handle endorsement income that isn't tied to a specific location?

22 For athletes, it's often calculated based on "duty days" - so if they spent 3 out of 180 work days in California, approximately 1.67% of their income might be allocated there. For tournament winnings, it's more straightforward because that prize money is clearly earned in a specific location. Endorsement income is trickier. It generally follows where the work is performed. If a player films a commercial in Florida, that portion might be taxable in Florida. Global endorsement contracts often have specific language about where the services are deemed to be performed, which affects taxation. This is why athletes negotiate these details carefully - the tax implications can be enormous.

3 Monaco doesn't actually have a tax treaty with the US. This means Monaco residents earning US income are generally subject to the full US tax rates without treaty benefits. Some tennis players deliberately establish residency in countries that do have favorable tax treaties with the US and other nations where they compete. For instance, Switzerland (where Federer lived) does have a US tax treaty that can provide certain benefits, though they'd still pay US taxes on US-sourced income. The tax planning behind where professional athletes choose to live can be incredibly strategic!

Exactly! And what really gets me is how this affects up-and-coming players who might not have the resources for those armies of accountants yet. They're probably getting hit with surprise tax bills they never saw coming. I wonder if there's a threshold where it becomes worth it to hire specialized tax help versus just accepting you're going to overpay. Like, at what point in prize money earnings does it make financial sense to get those expensive international tax specialists? Some of these lower-ranked players might be losing a huge chunk of their already modest winnings just to compliance costs and penalties for getting it wrong.