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Phil Mickelson Taxed 60.6 Percent on His $1.4M British Open Win

Image: Phil Mickelson Taxed 60.6 Percent on His $1.4M British Open Win

By Clyde Hughes   |   Thursday, 25 Jul 2013 08:10 AM

Phil Mickelson won big at the British Open last weekend, but the tax man turned out to be a big winner as well, taking 60.6 percent of the golfer's winnings, according to tax experts.

Sean Packard, tax director at athlete wealth management firm OFS, told ESPN's Kristi Dosh that he estimates the total tax rate from the United Kingdom on Mickelson's earnings will be $628,900.

The state of California will have its hand out for another 13.3 percent ($192,300), while the U.S. will take 2.9 percent in self-employment tax and 0.9 percent for the new Obamacare tax, Packard told ESPN.

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After all is said and done, Mickelson will actually get to hold an estimated $569,707 of his $1.4 million British Open paycheck, according to ESPN.

ESPN said athletes who compete in United Kingdom are also taxed on their global endorsement income, as well. ESPN wrote that amount is determined by dividing the number of days the athlete spends training and competing in the U.K. annually by the total number of days he trained and competed around the world.

That percentage is then multiplied by the athlete's total global endorsement income to determine the amount subject to taxation, according to ESPN. Mickelson ranked behind only Roger Federer and Tiger Woods for endorsement income, both of whom earned an estimated $65 million each, said the sports network.

Mickelson made rumbling about his California taxes he had to pay back in January, according to The Blaze.com.

"I’m going to have to make some drastic changes," Mickelson said of his tax challenges in California after the final Humana Challenge. "There are going to be some drastic changes for me because I happen to be in that zone that has been targeted both federally and by the state and, you know, it doesn’t work for me right now. So I’m going to have to make some changes."

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Tami Luhby, of CNN Money, said that Mickelson was not factoring in deductions he receives from his government taxes.

"Regardless of Mickelson's top rates, his actual income tax bill isn't anywhere near one-half of his income," Luhby said on CNNMoney.com in January. "While it's hard to tell what the golfer really pays without seeing his tax returns, millionaires pay roughly 26 percent of their income in federal taxes, on average, according to William McBride, chief economist at the Tax Foundation. This doesn't take into account other taxes, such as property levies."

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