In a thrilling conclusion to the World Cup championship, Spain emerged as the victor, securing the $50 million first-place prize from FIFA. However, this victory is not without its financial implications, as the winnings are subject to taxation by the Internal Revenue Service (IRS).
The IRS is set to claim a portion of the $655 million total prize pot, regardless of the team’s nationality. Robert Raiola, director of the sports and entertainment group at PKF O’Connor Davies, told MarketWatch, “It doesn’t make a difference who wins the game. The IRS will get a piece.”
Not just the players, but also the coaches, team staff, and referees are subject to this taxation. Additionally, the teams will have to navigate various tax codes as they play globally, with income streams that can be unpredictable due to performance-based compensation.
Rob Fagan, senior manager in KPMG’s Washington National Tax practice, pointed out that the U.S. has tax treaties with certain countries that may affect the taxation of athletes’ earnings. However, the final match between Spain and Argentina was held in New Jersey, a state that does not adhere to international tax treaties, implying that the Spanish team will be taxed on their winnings from the championship game.
Tax Breaks Don’t Cover Players
While the national soccer federations participating in the 2026 World Cup were expected to receive tax-exempt status, that exemption does not automatically apply to everyone associated with the game.
Even if a national federation qualifies for a federal tax exemption on its prize money, players, coaches, referees, and staff may still owe U.S. taxes on salaries, bonuses, endorsement earnings, and appearance fees earned during the tournament.
Their U.S. tax liability depends on applicable international tax treaties, which are designed to prevent double taxation and may offer exemptions or reduced taxes based on income thresholds. Tax treatment can also vary by country; for example, the U.S. has a tax treaty with Spain but not Argentina, and even among individuals on the same team.
World Cup’s $9 Billion Revenue Boom
The expanded 2026 FIFA World Cup is expected to generate more than $9 billion in revenue, making it the most lucrative sporting event ever, according to FIFA estimates, reported CNBC. The tournament’s expansion from 32 to 48 teams and from 64 to 104 matches created more opportunities in broadcasting, ticketing, and advertising, significantly boosting commercial revenue.
Notably, FIFA President Gianni Infantino‘s close relationship with President Donald Trump was a defining feature of the 2026 World Cup, co-hosted by the U.S., Mexico and Canada.
Buoyed by strong ticket sales, Infantino has floated expanding the 2030 World Cup to 64 teams. The centenary tournament will have a $6 billion budget and is expected to be an even bigger event, with FIFA positioning it as a more attractive spectacle for broadcasters.
In June, Alec Boccanfuso, portfolio manager of the Gabelli Opportunities in Live & Sports ETF (NYSE:GOLS), stated that the World Cup could accelerate soccer’s adoption in the U.S., leading to lasting commercial benefits for clubs worldwide.
This could potentially result in a 20%-30% uplift in soccer team valuation multiples if U.S. adoption accelerates post-2026, representing billions in incremental enterprise value for leading clubs. Gabelli argued that sports franchises are increasingly valuable due to growing revenue from media rights, sponsorships, ticket sales and merchandise.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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