Tax Management Services
for Professional Athletes

Tax Preparations for Soccer Athletes

Our Business is your Success

It’s no secret athletes pay a lot of taxes. With multiple income streams and most states looking to increase their tax dollars, athletes become easy targets under current tax rules. However, with high earnings comes the opportunity for great tax planning. Let’s look at how incorporating can help keep more money out of the hands of the IRS.

The Bottom Line

Incorporating a business for revenue streams outside of sports is a strategic approach to protecting your net worth and optimizing your tax position. Whether you choose an S corporation or C corporation structure, the most critical element is developing a comprehensive financial game plan and executing it with discipline.

At MBMG, Inc., we specialize in guiding professional athletes through the complexities of business structuring, tax strategy, and wealth preservation. Our tailored approach ensures you’re not only maximizing your earnings during your playing career but also building a secure financial foundation for you and your family long after you retire from the game. Let us help you create a winning strategy for lasting financial success.

LLCs

Limited Liability Company (LLC) Formation & Tax Strategy for Professional Athletes
Establishing an LLC is a strategic way for professional athletes to protect multiple revenue streams and safeguard personal assets from litigation. When structured properly, an LLC shields your net worth from creditors and legal claims arising from specific business activities.
For example, if you invest in real estate through an LLC and face a tenant lawsuit, your athletic income and other investments remain protected. This separation is crucial for athletes building diverse portfolios during their playing careers.

Tax Classification Options
LLCs offer flexible tax classification. You can elect to be taxed as an S corporation or partnership—both pass-through entities where income flows to your personal tax return without entity-level taxation.

The S Corporation Advantage
S corporation status offers significant tax benefits for athletes with substantial off-field income. You pay yourself a reasonable salary subject to payroll taxes, but remaining profits avoid the 15.3% self-employment tax—resulting in substantial savings.
This structure benefits income from sponsorships, endorsements, speaking engagements, social media, business ventures, and licensing deals. By channeling these earnings through an S corporation, you reduce your tax liability while maintaining legal protection.

Protecting Your Financial Future
Athletes face unique challenges: short career spans, concentrated earnings, and multiple revenue sources requiring sophisticated planning. We help you navigate LLC formation and tax strategies to maximize asset protection and minimize taxes during and after your playing career.
Contact us to discuss how an LLC can benefit your financial situation and build lasting wealth beyond your playing days

C corp

C corporation Strategy for High-Earning Athletes
While S corporations offer benefits, they have limitations for athletes in the highest tax brackets. S corps require a reasonable salary, and all earnings are taxed annually at your personal rate of 32-37%.

A C corp provides a compelling alternative. C corps are taxed at a flat 21% corporate rate—significantly lower than individual rates—and don’t require annual salary distributions.

The Strategic Advantage: Timing Your Income
Dividends from a C corp are taxable, but the key strategy is timing: defer dividends until retirement when you’re in a lower tax bracket. This allows you to:

Accumulate wealth at the 21% corporate rate during peak earning years
Distribute dividends in retirement at a lower personal tax rate.

Maximize lifetime tax savings
This is particularly effective for athletes whose income is concentrated during a short career, followed by lower earnings in retirement.

Is a C corp Right for You?
The choice between S corp and C corp depends on your income level, career timeline, and financial goals. We help athletes determine which structure maximizes tax efficiency for their unique situation.

Contact us to explore whether a C corporation strategy fits your financial plan.

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