Chargers Players! You May Be Overpaying Taxes: Check Your Payroll Portal

The Los Angeles Chargers payroll team has a policy to allocate 100% of player wages to the state of California, regardless of the player’s resident state. This may be a costly mistake. If you are not a resident of California, only the wages you earn while physically located in California should be taxable by California.

What’s at Stake

We recently saved one of our clients over $80,000 in taxes by catching this team policy and not simply filing their 2024 tax return based on the W-2 tax form provided by the Chargers.

Example

$10 million of income paid in 2024

The Chargers duty days schedule shows 167 out of 185 duty days were spent in California

(167/185) x $10,000,000 = $9,027,000 of wages allocated to California for state tax (Chargers W-2 will show all $10,000,000 allocated to California)

The remaining $973,000 of income would be allocated to away games you played in, or your resident state, depending on each state’s tax bracket. In almost all scenarios, these tax rates are lower than California’s 13.3% top marginal tax rate.

Action Items for Chargers Players

If you are not a California resident, login to your Dayforce Portal (https://chargers.workbright.com/users/sign_in) and confirm the address they have listed. If it is the team’s California address, and not your out-of-state resident address, you need to work with an experienced CPA to ensure your tax returns are being filed correctly. Your CPA will need to gather additional information from the Chargers payroll team in order to defend your claim that the W-2 provided is not correct.  

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