Connecticut Administrative Code › Title 12 - Taxation › 740(a) - INCOME TAX › Part II - Nonresident individuals › Section 12-711(c)-7 - Professional athletes and entertainers

Current through July 10, 2024
(a)
Members
				of professional athletic team
.
(1) The
				Connecticut adjusted gross income derived from or connected with sources within
				Connecticut of a nonresident member of a professional athletic team includes
				that proportion of such individual's compensation received for services
				rendered as a member of such team that the duty days spent within Connecticut
				rendering services for such team in any manner during the taxable year bears to
				the duty days rendering services for such team in any manner during the taxable
				year. In determining whether duty days are spent within Connecticut, travel
				days are duty days spent within Connecticut if Connecticut is the travel
				destination and are not duty days spent within Connecticut if Connecticut is
				not the travel destination, provided, when a game is scheduled to be played on
				a travel day, the duty day is considered to be spent where the game is
				scheduled to be played.
(2)
				Definitions.
(A) "Professional athletic team"
				includes, but is not limited to, any professional hockey, football, basketball,
				soccer or baseball team.
(B)
				"Member of a professional athletic team" includes, but is not limited to,
				active players, players on the disabled list and any other persons who are
				required to travel with and perform services on behalf of a professional
				athletic team, on a regular basis, including coaches, managers, trainers and
				equipment managers.
(C) "Duty days"
				mean all days, from the first day of the official pre-season training period of
				the professional athletic team through the day of the last game, including
				post-season games, in which such team competes or is scheduled to compete
				during the taxable year. "Duty days" include game days, travel days and
				practice days. For a member of a professional athletic team who renders
				services for a team on a day that is not otherwise a "duty day" (e.g.,
				representing a team at an all-star game), his "duty days" include such a day.
				"Duty days" for any member joining a team during the season shall begin on the
				day such person becomes a member and for any member leaving a team during the
				season shall end on the day such person ceases to be a member. "Duty days" do
				not include any try-out or pre-season cut days that a player shall survive in
				order to obtain a contract or any days for which a member is not compensated
				and is not rendering services for the team in any manner because such person
				has been suspended without pay and prohibited from performing any services for
				the team.
(D) "Duty days spent
				within Connecticut" mean duty days on which a member of a professional athletic
				team renders services, or is available to render services, for his team, within
				Connecticut. Days when a member is not available to render services for his
				team because of an injury are "duty days" for that member, but are not "duty
				days spent within Connecticut" for that member unless the team is based in
				Connecticut.
(E) "Compensation
				received for services rendered as a member of a professional athletic team"
				means the total compensation received for the official pre-season training
				period through the last game in which the team competes or is scheduled to
				compete during the taxable year, plus any additional compensation received for
				rendering services for the team on a date that is not otherwise a "duty day"
				(e.g., compensation for representing a team at an all-star game) during the
				taxable year. "Compensation received for services rendered as a member of a
				professional athletic team" includes, but is not limited to, salaries; wages;
				guaranteed payments; except as otherwise provided herein, bonuses; strike
				benefits; severance pay; and termination pay. Bonuses are includable in
				"compensation received for services rendered as a member of a professional
				athletic team" if they are earned as a result of play during the season or for
				playing in championship, playoff or "all star" games. Bonuses are also so
				includable if paid for signing a contract, unless all of the following
				conditions are met: payment of the signing bonus by a team (i) is solely in
				consideration of a nonresident athlete giving up his amateur and free agent
				status and for agreeing to be the exclusive property of the team; (ii) is not
				conditional upon the athlete playing any games, or performing any subsequent
				services, for the team, or even making the team; (iii) is separate from the
				payment of salary or any other compensation; and (iv) is
				nonrefundable.
(3) The
				portion of compensation received for services rendered as a member of a
				professional athletic team that is derived from or connected with sources
				within Connecticut may be determined on the basis of a method other than that
				provided under this subsection, if (A) the member establishes, to the
				satisfaction of the Commissioner, that another method is fairer and more
				equitable or (B) in the discretion of the Commissioner, the Commissioner
				determines that the method provided under this subsection does not fairly and
				equitably reflect the proportion of compensation received for services rendered
				as a member of a professional athletic team that is derived from or connected
				with sources within Connecticut. It shall be presumed, however, that the method
				provided under this subsection is a fair and equitable method of determining
				the proportion of compensation received for services rendered as a member of a
				professional athletic team that is derived from or connected with sources
				within Connecticut.
(4) Examples.
Example 1: Player A, a nonresident individual, is a member of
				  a professional athletic team. His accounting period for federal income tax
				  purposes (and, hence, for Connecticut income tax purposes) is the calendar
				  year. Player A's contract with the team requires Player A to report to his
				  team's training camp and to participate in all exhibition, regular season and
				  playoff games. This two-season contract covers an athletic season that begins
				  during calendar year 1993 and ends during calendar year 1994 (for which season,
				  Player A shall be paid $400,000) and an athletic season that begins during
				  calendar year 1994 and ends during calendar year 1995 (for which season, Player
				  A shall be paid $600,000). Assuming that Player A is paid $500,000 during 1994
				  (50% of his salary for the 1993-1994 season and 50% of his salary for the
				  1994-1995 season), the proportion of such compensation received by Player A for
				  calendar year 1994 that is derived from or connected with Connecticut sources
				  is that proportion of the $500,000 that the duty days spent within Connecticut
				  for Player A during calendar year 1994 (in both the 1993-1994 and 1994-1995
				  seasons) bears to the duty days for Player A during calendar year 1994 (in both
				  the 1993-1994 and 1994-1995 seasons).
Example 2: Player B, a nonresident individual, is a member of
				  a professional athletic team. During the season, Player B is injured and is
				  unable to render services for his team. While Player B is undergoing medical
				  treatment for this injury at a Connecticut clinic, his team, which is not based
				  in Connecticut, travels to Connecticut for a game. The days that Player B's
				  team spends in Connecticut for travel, practice and the game while Player B is
				  at the clinic are not considered to be duty days spent within Connecticut for
				  Player B for that taxable year but are included in duty days for Player B for
				  that taxable year.
Example 3: Player C, a nonresident individual, is a member of
				  a professional athletic team. During the season, Player C travels to
				  Connecticut to participate in the annual all-star game as a representative of
				  his team. The days that Player C spends in Connecticut for travel, practice and
				  the game are considered to be duty days spent within Connecticut by Player C
				  during the taxable year and are included in duty days for Player C during the
				  taxable year.
Example 4: Assume that the facts are the same as in Example
				  3, except that Player C is not participating in the all-star game and is not
				  rendering services for his team in any manner. Player C is travelling to and
				  attending the game solely as a spectator. If Player C is not required to render
				  services for the team during the all-star game break, then the days that Player
				  C spends in Connecticut during the break are not considered to be duty days
				  spent within Connecticut by Player C during the taxable year and are not
				  included in duty days for Player C during the taxable year.