Sebastian Aho is the Carolina Hurricanes’ alternate captain and highest-paid player with an annual compensation of $12 million. When he takes the ice in the Stanley Cup Final, he is competing for a championship. He is also, without trying, lowering his income taxes.

That sounds strange. Most people assume more games mean more income means more taxes. In fact, Aho will earn approximately $164,000 to $242,000 (average player payout if they lose vs. win the Stanley Cup) for his time playing in the playoffs, and his taxes will increase due to these additional earnings. However, the taxes owed on his $12 million salary in 2025-26 go up or down based on how many and where playoff games are located. Thanks to a tax mechanism most fans have never heard of, the Hurricanes’ deep playoff run has slightly reduced his state tax bill compared to a scenario where the team went home in April. The Stanley Cup Final in North Carolina (a 3.99% state income tax rate) and Nevada (0% state income tax rate) is a big part of the reason why.

How Athletes Actually Get Taxed

All professional athletes in the U.S. are subject to taxes at the federal rates, which progressively range from 10% at low income levels to a top marginal tax rate of 37% at high income levels. Beyond the federal rates, athletes must pay income tax in the state where they live and where they work. 

While determining federal taxable income is relatively straightforward, allocating taxable income across states can be complex. The mechanism used is based on duty days — an aggregation of game days, practice days, travel days, team meetings and media obligations spent in that state. The athletes then multiply each state’s percentage by the state’s income tax rate and their compensation to determine the income taxes owed for each state. For Aho, his taxes are anchored by North Carolina’s flat 3.99% rate, but road games in California (13.30%), New York (10.90%), and New Jersey (10.75%) push it higher.

Carolina’s Tax Geography Is Already Favorable

Before getting to the playoffs, it helps to understand why North Carolina is already a tax-efficient market for players.

North Carolina’s flat 3.99% rate (previously 4.25% in 2025) is among the most competitive in the league. Compare that to the New York Rangers, New Jersey Devils, and Los Angeles Kings, whose players face top marginal tax rates of 10.90%, 10.75% and 13.30%, respectively.

The Hurricanes’ regular-season road schedule reinforces the advantage. The Hurricanes play games in several states with no income tax at all: Nevada, Texas, Tennessee, Florida, and Washington, meaning income allocated to those games and corresponding duty days is not subject to taxation. The high tax rates Hurricanes will face in some road games is somewhat contained, with only three games in California, three in New York, and two in Washington, D.C. Put differently, taxation at these high levels due to games in these jurisdictions will account for a very small portion in the jock tax formula.

Playing More Games, Paying Less: the Playoff Effect

Any player can reasonably calculate their jock taxes owed as soon as the schedule is released. However, one key twist is the playoffs. When additional games get added to the schedule, the jock tax formula changes, thus altering the state income taxes owed, even for games previously played. This nuance can increase or decrease U.S. state income tax liability.

For the Hurricanes and Aho, the state income tax liability will increase due to more games being played in the U.S. As the Hurricanes advanced through the playoffs, they added duty days to the pool. More U.S. games mean more total compensation gets allocated to U.S. jurisdictions (relative to Canada). That sounds like a tax increase, and in one sense it is. Every additional game played within the U.S. shifts a small amount of taxable income away from Canada and into the U.S., increasing U.S. income tax liability.

However, it could also lower the state income tax liability. With additional playoff games in the low-income tax rate jurisdiction of North Carolina (as well as now playing games in the 0% income tax rate jurisdiction of Nevada), the jock tax will update to tax more of the players’ income at a lower level. This update will include games previously played during the regular season, and it will lead to lower tax rates on U.S.-sourced income.

The net result: the Nevada zero-rate games slightly outweigh the effect of pulling more income into the U.S. pool. The math is straightforward: without the Finals, Aho’s season runs 224 total duty days, a blended state rate of 4.580%, and a combined state tax bill of $492,490.

Now, add in the potential of seven games (four in North Carolina, three in Nevada) with an estimated two duty days in each jurisdiction per game, and the blended state rate falls to 4.445% with a combined state tax bill of $480,882. The difference yields an income tax benefit of $11,608 on Aho’s games already played simply because more games were added to the schedule.

Those numbers are modest precisely because both competing jurisdictions are low-rate. North Carolina at 3.99% and Nevada at 0% do not leave much room for differences in income tax liabilities. But the direction is clear: as teams play more games in low- or no-income tax rate states, players pay less in taxes on their regular season income.

What if the Finals Were in California Instead?

Eleven thousand dollars does not sound like much until you run the same series with a different opponent. Replace the Las Vegas Golden Knights with the Los Angeles Kings. Everything else stays the same: same schedule, same salary, same three road games. The only thing that changes is the road venue state income tax rate: Nevada at 0% becomes California at 13.30%.

The blended rate climbs from 4.445% to 4.780%. State taxes rise from $480,882 to $517,155. That is $36,273 more out of Aho’s pocket for playing the exact same number of games, just in a different state.

Put another way, the difference between facing Vegas and facing Los Angeles in the Stanley Cup Final is worth $36,273 to Aho in after-tax income. He does not play a single extra game. He does not earn a single extra dollar. The only variable is which state the road games are played in. Thus, more games are not inherently better or worse for a player’s tax bill. It depends entirely on where those games are played.

The way this duty day formula can work against an athlete was on full display this year in February. As reported in Forbes, Sam Darnold won Super Bowl LX at Levi’s Stadium in Santa Clara and left California with a tax bill larger than his $178,000 winner’s check. Eight incremental duty days in California exposed roughly $1.5 million of his $33.5 million salary to the state’s 13.30% rate, producing an estimated $197,771 tax obligation. He won the championship. He lost money playing in it. Same formula, opposite outcome. Where the games are played is everything.

What This Means Beyond the Ice

The jock tax has implications that extend well past any individual player’s return.

For teams, the home market rate functions as a hidden component of total compensation. A dollar offered by North Carolina is worth more after taxes than a dollar offered by a team in New York or California, all else equal. While not as low as the Florida or Texas-based franchises, North Carolina’s 3.99% flat rate puts the Hurricanes in a competitive tier when it comes to taxes.

For visiting players, every game at Lenovo Center creates a North Carolina nonresident tax filing obligation. As the Hurricanes host more high-profile playoff games, the state captures a share of income earned by some very highly paid athletes in professional sports. It is a small but real revenue stream that grows with the team’s postseason success.

And for Aho, there is also a Stanley Cup winner’s share, estimated to be around $242,000, if the Hurricanes come out with the trophy. This bonus would be added to Aho’s total income, and state income taxes would be collected on it using the duty day formula.

The duty day formula does not care about trophies. But during this year’s Stanley Cup Playoffs, it is working in the Canes’ favor for their players to pay less in income taxes.

This post was originally published in Poole Thought Leadership.