Goosen disputes IRS: ‘I’ve paid my taxes’
Monday, March 21, 2011
PALM HARBOR, Fla. – Retief Goosen and the Internal Revenue Service have a difference of opinion, and neither side is backing down.
The U.S. Tax Court is reviewing the 2-year-old dispute, which centers on how Goosen’s licensing and endorsement income from the tax years 2002 and ‘03 is classified for tax purposes.
According to the IRS in a finding letter dated September 2009, Goosen owes $164,698 in back taxes and $32,940 in penalties.
“I know I’ve paid my taxes,” Goosen said March 19 at the Transitions Championship. “I don’t owe the government anything.”
Goosen, 42, a South African who lives in Ascot, England, said he testified in a hearing last August.
Sergio Garcia, a Spaniard who lives in Crans-sur-Sierre, Switzerland, is facing a similar case with the IRS, but with much more at stake: $1.72 million, for the tax years 2003 and ‘04, according to the IRS. Garcia acknowledged the dispute but would not elaborate. His attorneys have petitioned the Tax Court for a “redetermination of the deficiency in tax.”
Professional athletes are taxed at different rates for their endorsement income. In general, the more money that is regarded as “royalty income” instead of “personal service income,” the less tax owed.
In 2002, Goosen played 13 events in the U.S. and 18 on the European Tour; in 2003, he played 18 U.S. events and 12 overseas.
According to Goosen, his largest endorser, TaylorMade, is a worldwide company that uses his likeliness in promotions and advertising more overseas than in the U.S.
“I’m a worldwide player, and they want to tax me for my time and appearances outside the U.S.,“ Goosen said of the IRS.
A similar tax dispute in the United Kingdom was dropped.