In Uncategorized on 03/15/2013 at 01:15

The “icon” is “El Niño”, who’s “notable for his charismatic and fiery personality which differentiates him from most others who play ‘the gentleman’s game’ for a living.” 140 T.C. 6, at p. 4, Sergio Garcia, filed 3/14/13. The “gentleman’s game”, ladies, is golf. What the LPGA thinks of that moniker I leave to your discretion.

Howbeit, Judge Goeke tries to contrast Sergio’s charisma and fire with the “cool, iceman demeanor” of Retief Goosen. See my blogpost “Name and Number”, 6/9/11, for more about Goose and his tax problems.

So the issue is the same as in Goose’s case: what part of the loot he got is royalty (for use of his name and image), and what compensation for personal services (showing up at tournaments and winning, while wearing the sponsor’s goods from head to toe)?

Even though Goose had a higher ranking than Sergio, and even won a “Major” tournament, which Sergio never did, Sergio got paid more for his likeness and endorsements than Goose. Sergio was a “Global Icon.”

Ol’ Goose was just a “brand ambassador” (lower case), and that ranks lower than a Global Icon.

Royalty is not US taxable (Sergio lives in Switzerland and there’s a treaty), but personal services is. Sergio wanted to sell the Court a 85-15 split (guess which part was taxable; no prize for the correct answer), with the usual battle-of-the-experts.

Judge Goeke: “Considering the facts and prior caselaw, we do not believe a 50-50 split between royalty and personal service payments is appropriate in petitioner’s case. Petitioner was TaylorMade’s only Global Icon during the years at issue; he was the centerpiece of TaylorMade’s marketing efforts and the golfer around whom TaylorMade sought to build its brand. The same cannot be said of Mr. Goosen. We find that petitioner’s status as a TaylorMade Global Icon, especially the extent to which Taylor Made used his image rights to sell its products, is strong evidence that his TaylorMade endorsement agreement was more heavily weighted toward image rights than Mr. Goosen’s.” 140 T. C. 6, at p. 24.

So Sergio gets a 65-35 break from Judge Goeke, who’s apparently enthralled by these big-ticket golfers.

If I write enough of these blogposts, maybe I can get to be a Tax Global Icon.

Leave a Reply

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: