WNBA superstar Kelsey Plum made headlines this offseason with her contract decision, but it's her tax logic that's now drawing the most attention—and not in a good way. The Los Angeles Sparks guard opted for a one-year deal worth $999,999, turning down a potential $1.4 million supermax offer under the league's new collective bargaining agreement. Her reasoning? She wanted to avoid California's so-called "millionaire's tax."
In a viral clip with YouTuber Austin Franklin, Plum explained her thinking: "I saved like $13,000 in not claiming a dollar." She was referring to the state's Mental Health Services Act, a 13% surcharge on income over $1 million. But tax experts are quickly pointing out that Plum's math doesn't add up.
"Someone please explain marginal tax rates to Kelsey Plum," wrote Joe Pompliano on social media. "If she earned one more dollar, she would be taxed 13 cents…not $13,000." The key is that marginal tax rates only apply to the income above the threshold, not the entire sum. So earning $1 million would have cost Plum an extra $0.13 on that single dollar—not $13,000.
Plum's decision to sacrifice a larger contract to help the Sparks build a championship roster was already a story of team-first mentality. But her misunderstanding of basic tax principles has sparked a broader conversation about financial literacy among professional athletes. "A basic understanding of taxes, their brackets, marginal rates, etc should be taught in every high school in America," one commenter noted. "In no circumstances are you 'saving money' on taxes by turning down any amount of raise."
This isn't an isolated incident. Many Americans mistakenly believe that earning more can actually cost them money due to higher taxes—a myth that experts say leads to poor financial decisions. For Plum, the confusion may stem from California's unique tax structure, but the math remains clear: turning down a raise never saves you money in taxes.
Plum's move to take a pay cut is reminiscent of other athletes who have prioritized team success over personal gain. For more on that, check out Kelsey Plum's $400K Sacrifice Ignites Sparks' Championship Dreams. However, the tax misstep has overshadowed her good intentions. It's a reminder that even the brightest stars can stumble when it comes to financial know-how.
Meanwhile, the Sparks are counting on Plum to lead their title push. But off the court, this viral moment serves as a teachable case study. As one expert put it, "Please hire a good accountant before making life-altering financial decisions based on a misunderstanding."
For more on athletes navigating off-field challenges, see Angel Reese Shows Maturity in Return to Chicago, No Hard Feelings and Mendoza's Draft Night Choice: Family Over Fame Shows True Character.
