Mar
23
2011
Retief Vs. The IRS
By Stephanie Wei under European PGA Tour

A few weeks ago, Conor wrote a post outlining Sergio Garcia’s battle with the IRS, along with a brief mention of Retief Goosen’s similar woes. Difference is, the IRS claims Sergio owes $1.72 million, while the petition filed against the Goose is a tad more modest, amounting to $164,698 in back taxes and $32,940 in penalties. While Sergio won’t comment on the issue other than acknowledging the matter, Goosen is adamant that the IRS has made a mistake.

At last week’s Transitions Championship, Goosen told Golfweek‘s Alex Miceli, “I know I’ve paid my taxes. I don’t owe the government anything.”

Are you falling asleep yet?

Now, obviously, I’m not a tax lawyer (nor would I ever want to be). Yawn. Here’s an excerpt from Miceli’s article, explaining the IRS vs. Goosen:

Professional athletes are taxed at different rates for their endorsement income. In general, the more money that is regarded as “royalty income” instead of “personal service income,” the less tax owed.

In 2002, Goosen played 13 events in the U.S. and 18 on the European Tour; in 2003, he played 18 U.S. events and 12 overseas.

According to Goosen, his largest endorser, TaylorMade, is a worldwide company that uses his likeliness in promotions and advertising more overseas than in the U.S.

“I’m a worldwide player, and they want to tax me for my time and appearances outside the U.S.,“ Goosen said of the IRS.

Now if that’s the case, it doesn’t make any sense. I’ve been told by a colleague that the IRS sometimes has trouble grasping the intricacies that go along with the golf industry. I’m thinking things get complicated when you earn income from different companies. Actually, I’m sure that’s a huge pain in the butt. I’m also sure PGA Tour players have incredibly crafty accountants that would make sure all the “I’s” are dotted and the “T’s” are crossed.