IRS in the hot seat over potential cash grab from Spain’s World Cup winnings: ‘It’s a rip-off’
US House lawmakers have raised bipartisan concerns that the Internal Revenue Service could tax a large share of the $50 million prize money awarded to Spain for winning the 2026 FIFA World Cup, with one representative branding the potential levy "a rip-off." The issue has drawn attention because it touches on how the US tax system applies to foreign national teams and individuals earning income connected to events held on American soil, raising broader questions about fairness and international sporting relations.
Spain, as reigning champions of the tournament, is facing the prospect of federal tax being applied to a significant portion of its winnings, with some estimates pointing to a rate as high as 30%. The matter was discussed by House lawmakers, who questioned whether it was appropriate for the IRS to take a cut of the championship payout, though the article does not detail any final ruling or resolution on the matter.
In short
- Spain's $50m World Cup prize may face US federal tax
- Some estimates suggest a tax rate as high as 30%
- House lawmakers, bipartisan, called the potential IRS levy a "rip-off"
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
The IRS's position reflects a fundamental principle of US tax law: income earned within the United States is generally subject to federal taxation, regardless of who earns it. The US is providing the venue, infrastructure, security, and global platform for the tournament, making the application of tax law consistent with how other foreign entities conducting business on American soil are treated. Maintaining this standard ensures equitable application of the tax code and prevents selective exemptions based on the nature of the earner.
The case against
The prize money represents an exceptional case involving international sovereignty and sporting relations that warrants different treatment from routine business income. A national team's World Cup winnings are fundamentally distinct from commercial enterprise income, and many other countries exempt similar international sporting prizes from taxation. Imposing such a levy risks damaging America's reputation as a welcoming host for global events and could discourage future tournaments, whilst the money will already face taxation in Spain where it ultimately benefits the nation.
Explained simply
FIFA is football’s international governing body and organiser of the men’s World Cup, a tournament played by national teams. The 2026 edition is due to be hosted by the United States, Canada and Mexico, and FIFA awards prize money to teams based on their results.
US tax rules can apply to income earned in the country, including by foreign visitors, so a prize linked to a tournament held partly in the US may raise questions about how the rules apply. The IRS administers federal taxes, while Congress makes tax laws; lawmakers’ interest reflects a wider debate over how international sporting prizes should be treated.