We are familiar with Kelsey Plum, four-time WNBA all-star. Also Kelsey Plum, former NCAA season scoring record holder. And Kelsey Plum, gold-medal Olympian. And Kelsey Plum, as of 2025 the standout guard on the Los Angeles Sparks and linchpin of their hope to return to the playoffs after five years on the outside looking in.
Until Friday, however, we were unfamiliar with Kelsey Plum, would-be income tax sage.
That’s when Plum, in an interview with sports commentator Austin Franklin, explained why she accepted a one-year Sparks contract paying her $999,999 despite her eligibility for much more under the league’s collective bargaining agreement.
Earlier, she had said that she wished to give the Sparks salary headroom to build a team around her. But she told Franklin that she also wished to avoid the California income tax that would kick in the moment her salary hit $1 million.
At that level, she said, she would become subject to the state’s top tax rate of 13%, so the additional dollar would cost her $13,000. (Actually, the top rate is 13.3%, so $13,300, but never mind.)
Cue the tsunami of ridicule coming from self-appointed tax experts, who informed her online that the 13% is a marginal rate, meaning that it’s applied only to taxable income above a certain threshold such as $1 million, not to one’s entire income.
The Spun, a sports blog, flayed Plum for her “embarrassing lack of tax knowledge.” A sports business blogger named Joe Pompliano appealed for someone to “please explain marginal tax rates to Kelsey Plum,” and asserted that the one extra dollar would cost her not $13,000, but 13 cents.
As it happens, both the Spun and Pompliano also got the tax calculation wrong, as have others. More on that in a moment.
First, since many of us are still feeling the pain from the April 15 tax deadline, here’s a primer on marginal tax rates as a thing.
Marginal rates are what give us tax brackets and make the U.S. tax system progressive — that is, putting a bigger proportionate bite on higher incomes.
For the current tax year, for example, couples earning up to $24,800 in taxable income will owe 10% of it in federal personal income tax. Those in the next bracket, up to $100,800, will pay 12% on that additional tranche, 22% on any additional income up to $211,400, and four higher percentages on four further chunks of income, topping out at 37% on everything above $768,701.
You might hear the wealthy and their cat’s-paws in Congress whining about paying a 37% tax, but that’s the rate only on the top tranche. By my back-of-the-envelope calculation, under this system the overall federal rate on a taxable income of $1 million would come to a rate of about 29%.
California, where Plum presumably files, has nine tax brackets ranging (in 2025) from income below $22,158 for couples (rate of 1%) to $1.486 million and above (12.3%); the 1% surcharge on income over $1 million brings the rate on those taxpayers to 13.3%.
This can be confusing even to people steeped in tax policy, but the confusion frequently has been weaponized by anti-tax warriors to make taxes seem even more onerous than they are.
“The failure of so many people to understand the basic facts about marginal tax rates,” observes Scott Lemieux of the Lawyers, Guns & Money group blog and the University of Washington (where Plum got her degree), “is one of those little pockets of ignorance that manufacture Republican voters.”
We saw that process in full cry in 2019, when Alexandria Ocasio-Cortez, then a newly minted Democratic congresswoman from New York, went on “60 Minutes” and proposed raising the top federal rate on the wealthiest Americans to as much as 70% from 37%.
As I wrote at the time, “Conservative heads exploded.” Then-House Minority Whip Steve Scalise (R-La.) accused AOC on Twitter of wanting to “take away 70% of your income and give it to leftist fantasy programs.” Right-wing anti-tax crusader Grover Norquist implied that the “expropriation” of 70% of “your production” was coming uncomfortably close to “slavery.”
This was, I wrote, part of an effort by Republicans and conservatives to smear AOC “as a know-nothing socialist ditz unfit to sit in the House chamber with all those gray-bearded sages who have made the House such a model of reasoned and informed debate.”
It wasn’t clear whether Scalise, Norquist and AOC’s other critics understood that she was talking about a marginal rate of 70%, or whether they themselves understood the difference between an overall rate and a marginal rate and were only gaslighting their own followers. During the interview and on-camera, AOC made it quite clear that she knew the difference: She noted to her interviewer, Anderson Cooper, that her proposal “doesn’t mean all $10 million are taxed at an extremely high rate.”
On the air, Cooper (a scion of the Vanderbilt family, by the way) called her proposal part of “a radical agenda.” But it was hardly as radical as all that.
The top marginal rate in the U.S. was 70% from 1965 to 1981, a period that covers the presidencies of Lyndon Johnson, Richard Nixon, Gerald Ford and Jimmy Carter, and for most of that period that rate was applied to incomes starting at about $200,000; that much income in 1981 dollars is the equivalent of about $760,000 today.
Going further back, the top rate was 91% from 1946 to 1963 (the Truman, Eisenhower and Kennedy years), applied to incomes of $400,000 or more. That income in 1963 had the buying power of $4.3 million today. Those years included periods of unexampled prosperity and the growth of a strong middle class in the United States. The rich kept working and creating jobs, somehow.
That brings us back to Kelsey Plum. Even Plum’s defenders, not to mention her critics, plainly didn’t make the effort to read the relevant California law, so they got it wrong themselves.
It’s the California Mental Health Services Act, which voters passed in 2004. Designed to restore funding for (obviously) mental health services, the law imposes a 1% state tax surcharge on millionaires, bringing the marginal rate on those taxpayers to 13.3%. (I tried to reach Plum via the Sparks communications team to ask her reaction to the pile-on and who told her she’d be subject to $13,000, but didn’t hear back.)
But the surcharge kicks in at income over $1 million. In other words, if Plum accepted a contract paying $1 million rather than $999,999, her additional tax wouldn’t be $13,000, or even 13 cents. It would be zero. If she were paid, say, $1,000,001, then she’d be subject to the surcharge, which would come to 13 cents.
Andrew Holleran, the editor of the Spun and author of the article about Plum, told me he plans to run a correction. Pompliano, to his credit, pointed out in his post that it’s unlikely that Plum’s total income is only $999,999, given the availability of endorsement income and other ancillary deals. So she’s probably subject to the California millionaires tax even after depriving herself of an extra dollar.
One would hope that a star athlete would have professional help preparing her taxes and advising her on contract terms. But given how often marginal rates are misunderstood, perhaps that wouldn’t help. But now you know.
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