Net income is the amount of money remaining after all taxes, fees, and deductions are applied.
It represents what an athlete actually keeps in their bank account, not what they earn on paper.
For athletes, net income is often dramatically lower than gross income due to federal tax, state tax, jock tax, agent fees, and other mandatory costs.
Depending on the location of an athletes primary residency and the states in where they play games (yes all states) across a season, pro athletes typically lose ~45-50% of their gross earnings just to taxes.
In states like California or New York, a pro on a $100 million deal can come away with ~$40-$50 million because the states levy the highest income tax rates in the U.S.
If an athlete plays in Seattle, Vegas, Texas or Florida however, these states do not levy any state income tax. Thus, athletes in these states are able to keep ~5-13% more of their gross earnings.
Headlines give highlights. Location, lifestyle and financial literacy are the difference between the retired pros who keep and grow their fortunes and the over 70% of pro athletes who end up broke within 5 years of retirement from their sport.
How Net Income Applies in Different Leagues
NCAA / NIL Athletes
NCAA athletes are able to earn income due to NIL.
For collegiate athletes, net income is now often the first financial wake-up call for many young adults in sports across the nation.
Some athletes may not earn an income at all, whilst top athletes are paid millions from brand sponsorships, endorsements and other forms of legal NIL revenue collection tactics.
Athletes in NCAA are now able to not just collect NIL money, but are also exposed to their first encounters with major taxes, investment strategies, residency rules and more.
What matters most at this stage is not how much money a collegiate athlete grosses, its the amount of money that is kept, pocketed and managed properly with long-term potential.
Use Cases
- NIL deal payments
- Social media income
- Appearance fees
- Early budgeting and tax planning
Example
A college athlete earns $50,000 from NIL deals. After federal and state taxes, net income may be closer to $32,000–$35,000, depending on location and deductions.
NFL
In the NFL, contracts are some of the widest range in all of sports.
Because the average NFL career is less than 5 seasons, making net income far more important than headline salary figures.
All athletes in the NFL sit in the top federal tax bracket of ~37% for 2025.
Jock tax, state income tax depending on location, agent fees, lawyers, and lifestyle expenses add up quickly and drain massive contracts on paper.
Often contracts are cut in half into smaller financial realities than what gets reported to the fans.
Players who focus on collecting as much as they can early are better positioned to survive the league’s volatility and set themselves up and their families for life.
This can be accomplished off just 1 or 2 seasons in the NFL.
Use Cases
- Contract salary
- Signing bonuses
- Endorsements
- Post-tax budgeting
Example
An NFL player earning $4 million in gross income may take home closer to $2.2 million after taxes and fees, making net income the true measure of financial health.
NBA
NBA players operate in some of the largest contract salary ranges and tax brackets in all professional sports, often while living in the most expensive states and cities.
Nearly all NBA contracts are guaranteed and with contract values being public, lifestyle inflation becomes a real risk.
Net income is the metric that determines whether long-term wealth is being built, or quietly drained and lost before its built.
What you do with your money when its flowing in is the same thing you will do when it stops coming in.
A disciplined mindset is the first key to financial longevity.
Use Cases
- High-bracket tax exposure
- Agent and union fees
- State tax planning
- Lifestyle planning
Example
An NBA player earning $40 million in a high-tax state may net less than half after taxes and fees, despite headline contract numbers.
MLB
MLB players face unique challenges due to multi-state schedules, deferred compensation, and long seasons that spread income across jurisdictions.
Net income can fluctuate year to year even with stable contracts, making tax planning and residency decisions critical to preserving earnings over a long career.
Due to the highest number of games across all sports leagues, players in MLB often pay the most in total taxes across the U.S.
Use Cases
- Multi-state income allocation
- Deferred compensation
- Endorsements
- Long-term financial planning
Example
An MLB player earning income across many states sees net income vary year to year based on schedule and residency.
NHL
For NHL players, net income is complicated by cross-border taxation, currency differences, and international treaties.
Contract values alone fail to reflect what players actually retain once foreign taxes, exchange rates, and multiple tax authorities are involved.
Understanding net income is essential to maintaining financial clarity in a global league.
Especially because the difference between living in Toronto or Florida is ~5-10% or more of your gross income, which when dealing with millions is a lot of money.
Use Cases
- Cross-border taxation
- Currency exchange
- Treaty considerations
- Net pay reconciliation
Example
An NHL player paid in U.S. dollars but taxed in multiple countries must focus on net income, not contract value.
MLS / International Soccer
Soccer players often earn income across multiple countries and tax systems, making net income far more important than gross wages.
Exchange rates, withholding rules, and residency status can dramatically affect take-home pay, even when contracts appear identical on paper.
Net income provides the only consistent measure of financial stability.
Use Cases
- Dual residency
- International tax rules
- Withholding differences
- Net pay consistency
Example
A soccer player earning income in two countries may experience large swings in net income due to exchange rates and taxes.
Combat Sports
In combat sports, income is irregular and expenses are high, making net income the true indicator of financial health.
Fighters are responsible for many out-of-pocket costs that don’t exist in team sports. A large payday does not guarantee long-term security without disciplined net income tracking and safe investment portfolio strategies to maximize compounding but reduce risk of losing your fortune.
Use Cases
- Irregular income cycles
- Lump-sum payouts
- Expense-heavy preparation
- Cash flow management
Example
A fighter earning $300,000 for a fight may net significantly less after federal tax, state tax, and training expenses.
Golf / Individual Sports
Golfers and individual athletes earn prize money, not salaries, unless signed to the new LIV golf.
Winnings look substantial but are heavily reduced by travel, coaching, and global tax exposure.
Especially because high-paying sponsors are going to flock near the top of the pact, being the same players who are likely collecting a majority of tournament winnings.
Because expenses are ongoing and tournament earnings fluctuate, net income determines sustainability, net worth and career longevity more than league/salary controlled sports.
Use Cases
- Prize money
- Travel-heavy expenses
- Sponsorship income
- Annual net tracking
Example
A golfer earning $1 million in prize money may net far less after taxes and travel costs.
Racing / NASCAR / F1
Drivers earn from a mix of sponsorships, team compensation, and international events, all with different tax implications.
Net income is the only way to assess whether these diverse revenue streams are truly profitable after expenses, travel, and taxation across borders.
Use Cases
- Sponsorship revenue
- Team compensation
- International income
- Expense management
Example
A driver earning income from multiple sources must calculate net income to understand real profitability.
Gross Income vs Net Income
- Gross income = total earnings before taxes & deductions.
- Net income = money actually pocketed/retained post taxes.
Net income is what funds:
- Housing
- Investments
- Savings
- Long-term security
Why Net Income Matters
Net income:
- Reflects true financial reality
- Prevents lifestyle inflation
- Guides investment decisions
- Separates high earners from wealthy individuals
Athletes who treat the tracking of their income as a nonpriority often overspend early and struggle later.
Gross earnings sound amazing in the news for fans.
For athletes, having the knowledge of taxes and lifestyle costs, plus location economics in general is the difference in “earning $100 million” and actually netting $100 million in liquidity.
Related Terms
- Gross Income
- Federal Tax
- Income Tax
- Tax Write-Off
- Effective Tax Rate
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for everything you do flows from it.
– Proverbs 4:23
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