Felix Stephensen to Give Up More than Half of His WSOP Winnings to Taxes4 years ago
Winning the WSOP Main Event is the dream of every poker player. Coming in second place, however, is not too shabby either; especially when that finish carries a prize-tag of $5.1 million. That’s how much the Norwegian Felix Stephensen earned after losing heads-up to Martin Jacobson. But there is a twist.
Norwegian tax laws are not very favorable to professional poker players, especially to those who declare poker, like Stephensen, to be their occupation. As it turns out, Felix will have to pay taxes in excess of 50% on his winnings, giving up about $2.5 million. Pretty much the equivalent of losing to a one-outer on the river.
Poker prizes are specifically mentioned in the ABC of tax regulations. It says that individual prizes of more than 1,000 kroner ($150) are eligible for tax, but there are possibilities to deduct expenses, like starting fees, that relate directly to poker tournaments." Trond Erik Andersen, business lawyer;
To make things even more painful, Stephensen, who’s been living in London for two and a half years now, would not have to pay any tax whatsoever had the victory come just a few months later. According to his home country's regulations, Norwegian citizens residing abroad for more than three years are not required to pay poker taxes back home.
While the argument that the $2.5 million he will get to keep is still a lot of money holds true, it still feels like a bad beat that could have been avoided if things had aligned just a bit differently. As it is, it seems that there is no way out of this one and Stephensen will have to give up 50.4% of his Main Event winnings to cover the taxes and other deductions prescribed by Norwegian law.
What about the Champ?
You must be wondering at this point, what about the winner, Martin Jacobson, who walked away with $10 million? Well, as it turns out, he will not have to give up a single dime!
Although originally from Sweden, Jacobson has been residing in London, UK, for a long time now and his poker winnings will be taxed according to UK laws, i.e. he will not be taxed. Due to the taxation policy (or the lack thereof), London has become a new haven for poker players as more and more pros are finding a home in the England capital.
If Jacobson was still residing in Sweden, however, it would have been a whole different story. Poker is highly regulated in the country and he would have to pay upwards of 30% on his winnings. So Jacobson not only won the whole thing, but he also gets to keep all the marbles.
When you run good, you just run good!
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