Revisiting Who Wins at the Masters
A few weeks following the exciting conclusion to the 2026 Masters Tournament, the team at Woodward Financial Advisors got into a debate over who really won The Masters, and we’d like your help settling it.
Like much of the world, you may have spent a whole weekend watching the winner of The Masters Tournament slip on the green jacket and take home millions of dollars in prize money. But just a few miles away, thousands of homeowners in Augusta, Georgia may be having an even more tax-efficient week, quietly earning income that the IRS never sees.
This had us asking the question…Who is the real “winner”?
The Golfer: Big Win, Big Tax Bill
Let’s look at some numbers:
Rory McIlroy just won The Masters for the second year in a row. This year, he won $4.5 million (up from $4.2 million in 2025). However, this is pre-tax winnings
- 30% US federal withholding for non-resident athletes
- ~5.75% Georgia state tax
- Total tax = roughly 35%
After-tax winnings: $2.9 million
Then there are the fees, costs, and home-country taxes
- Agent and caddie fees are typically around 10-20%
- Travel/team costs
- Potential home-country taxes
That $4.5 million prize can quickly shrink closer to $2 to $2.5 million in real take-home (about 50% of the actual prize money)
The Homeowner: The Augusta Rule Advantage
While Roy celebrated his win and made an estimated tax payment, a few miles away, thousands of homeowners in the surrounding area were having their own exciting week by cashing in on tax-free income sanctioned by the IRS’s “Augusta Rule.”
For the week of The Masters Tournament, homes in Augusta, GA can rent for $8k on the low side to over $100k! 100% of that income could be tax-free and non-reportable, showing that sometimes the best seat at The Masters is owning the house next to it.
The “Augusta Rule” (formally Internal Revenue Code Section 280Ag) is a US tax law that allows homeowners to rent out their personal residence for up to 14 days each year without reporting the rental income. Since this income is “non-reportable” to the IRS, there is limited data regarding the exact amount that homeowners bring in each year.
However, reasonable estimates suggest that $40 million - $60 million of rental income may go untaxed each year during Masters Week. Some estimates suggest the number could be as high as $150 million.
Here are a few Frequently Asked Questions about the Augusta Rule:
Why Does the Augusta Rule Exist?
Like many parts of the tax code, opportunities emerge where rules meet real-world behavior. The Augusta Rule was originally designed to help homeowners rent occasionally and avoid administrative burden for small rentals. It was not originally intended for high-demand events like The Masters Tournament.
What If I Don’t Live in Augusta?
Although the rule has coined the name the “Augusta Rule”, this tax benefit is available to you regardless of where you live in the US. While the idea of renting your home isn’t for everyone, those who choose to do so can benefit if structured smartly – particularly when open to short-term rental opportunities or if there is event-driven demand for your home.
How Can Woodward Help?
At Woodward Financial Advisors, our goal isn’t to win the Masters - though a few of us dare to dream. Instead, we’re committed to building a tax plan that works for you. If you’re curious about how strategies like the Augusta Rule or other tax-efficient planning opportunities might apply to your situation, we’d welcome the conversation. Reach out to our team to explore how your financial plan can work smarter for you!