SPAIN’S $50 MILLION WORLD CUP PRIZE MAY OWE THE IRS A CUT
Spain beat Argentina 1-0 in extra time in the World Cup final on July 19, 2026, and its reported $50 million World Cup prize from FIFA came with a tax catch. Because some of the matches were played in the United States, the IRS can claim a share of the money.
The final was played at MetLife Stadium in New Jersey, and Yahoo Finance identified Ferran Torres as the scorer. Winning the trophy, it turned out, did not mean winning the tax argument.
MarketWatch reported that U.S.-source income from activity performed in the United States is generally subject to U.S. tax. Sports and tax professionals told the outlet they believe the IRS can tax the relevant income earned there.
“It doesn’t make a difference who wins the game. The IRS will get a piece,” said Robert Raiola, director of the sports and entertainment group at PKF O’Connor Davies. He said the issue can apply to coaches, staff and referees, not only players.
Mina Capouet, a senior legal analyst at Wolters Kluwer, was quoted by Accounting Today on the player side: “At the individual player level, there is no exemption.” Yahoo Finance reported that the 48 national associations could apply for U.S. tax-exempt status under section 501(c)(3), which could remove federal income tax on their tournament income. Players do not get that treatment.
How the IRS math works
Fortune reported that the IRS treats international athletes’ income as taxable when it is “connected to services performed in the United States.” The tournament was co-hosted by the United States, Canada and Mexico, and Fortune reported that the tax is figured by comparing the matches a team played in each host country with its total matches.
Yahoo Sports reported that the IRS, the Canada Revenue Agency and Mexico’s Servicio de Administración Tributaria reached a joint agreement on how to allocate World Cup compensation and tax withholding.
The Kansas City Star estimated that about $44.6 million of Spain’s prize counted as U.S.-sourced under that formula. TheStreet reported that the IRS default is 30% withholding on gross U.S.-sourced income, which would come to about $13.4 million on Spain’s prize.
That is withholding, not necessarily the final bill. Recipients can file returns afterward to reconcile what was taken out, and players can seek refunds if too much was withheld.
Spain also had an edge over its opponent. MarketWatch reported that the United States has a tax treaty with Spain but not with Argentina, citing an IRS database.
Yahoo Finance reported that Spanish players could seek relief under that treaty by filing Form 8233 or W-8BEN and getting a U.S. taxpayer ID. A Central Withholding Agreement can also let withholding be based on estimated net income and graduated rates instead of 30% of the gross. The application has to be filed at least 45 days before the athlete’s first U.S. game, or the 30% default applies.
State “jock taxes” may also apply in the states where the players competed, Fortune reported. A tax expert identified as Koenigsberg described how foreign tax credits work in practice: “Ultimately, you end up paying the higher of the two countries’ tax.”
Money was a World Cup storyline off the pitch too. Some fans skipped tips, so restaurants added 20%.
As for who actually gets the cash, FIFA did not pay the players or staff directly. Yahoo Finance reported that FIFA paid the prize to Spain’s football federation, which decides how much to distribute as bonuses, and that the federation may qualify for federal tax-exempt status while the individual players do not.
Yahoo Sports reported that the Royal Spanish Football Federation and the players agreed that 45% of the winnings would be shared among the players as a bonus.
