Momma There Goes That Man Posted December 11, 2023 Share Posted December 11, 2023 What the ****. that’s wild man. Just give me $2 million a year for the next decade and then I’ll take a check for $680 million” Link to comment Share on other sites More sharing options...
The Evil Genius Posted December 11, 2023 Share Posted December 11, 2023 (edited) Yeah that doesn't seem like it should be allowable. I wonder if the players union will have a problem with it? Edit..or small market owners who rely on luxury tax teams to assist. Edited December 11, 2023 by The Evil Genius Link to comment Share on other sites More sharing options...
FootballZombie Posted December 11, 2023 Share Posted December 11, 2023 Apparently it was Ohtani's idea to help the Dodger build a better team around him... Still don't sit right in the craw. 1 Link to comment Share on other sites More sharing options...
Ball Security Posted December 11, 2023 Share Posted December 11, 2023 He’ll get paid $68M/year from ages 39-48. Sounds like a good retirement plan. His luxury tax hit is still $46M/year which, I believe, is the highest in the league. Link to comment Share on other sites More sharing options...
Momma There Goes That Man Posted December 11, 2023 Share Posted December 11, 2023 I wonder how the taxes work if he’s retired after his contracted and goes back to Japan while he’s cashing those checks. Might come out ahead there Link to comment Share on other sites More sharing options...
The Evil Genius Posted December 12, 2023 Share Posted December 12, 2023 (edited) 21 minutes ago, Momma There Goes That Man said: I wonder how the taxes work if he’s retired after his contracted and goes back to Japan while he’s cashing those checks. Might come out ahead there I think he will still have to pay California state income tax on it. I believe deferred compensation is taxable in the state where the employee works and earns the compensation, even if they move after their work and before receiving the deferred compensation. Fwiw, I bet he's out of the league at 36/37. Edited December 12, 2023 by The Evil Genius Link to comment Share on other sites More sharing options...
TradeTheBeal! Posted December 12, 2023 Share Posted December 12, 2023 Deferring without interest is a dip**** move, by all parties. Even mi familia will throw a point and a half on there to keep it “above board”. It’s clown shoes. Link to comment Share on other sites More sharing options...
Spaceman Spiff Posted December 12, 2023 Share Posted December 12, 2023 Not only that, but if he’s not living in California when the deferment kicks in, California can’t tax him on it. Brilliant. Link to comment Share on other sites More sharing options...
The Evil Genius Posted December 12, 2023 Share Posted December 12, 2023 (edited) Just now, Spaceman Spiff said: Not only that, but if he’s not living in California when the deferment kicks in, California can’t tax him on it. Brilliant. Yeah i think that's wrong. Edited December 12, 2023 by The Evil Genius Link to comment Share on other sites More sharing options...
Spaceman Spiff Posted December 12, 2023 Share Posted December 12, 2023 Just now, The Evil Genius said: Yeah think that's wrong. Well not according to this guy. Link to comment Share on other sites More sharing options...
TradeTheBeal! Posted December 12, 2023 Share Posted December 12, 2023 1 minute ago, Spaceman Spiff said: Not only that, but if he’s not living in California when the deferment kicks in, California can’t tax him on it. Brilliant. Everybody meet my tax attorney. Spiff at Law. 2 Link to comment Share on other sites More sharing options...
Spaceman Spiff Posted December 12, 2023 Share Posted December 12, 2023 Just now, TradeTheBeal! said: Everybody meet my tax attorney. Spiff at Law. That’s Spiff S. Preston, Esquire. 2 Link to comment Share on other sites More sharing options...
The Evil Genius Posted December 12, 2023 Share Posted December 12, 2023 1 minute ago, Spaceman Spiff said: Well not according to this guy. Yeah, you should read the comments too. Fwiw the payout period for a non qualified deferred comp has to be 10 years or more for the Ca state income taxes to not kick in, from what I've read. Also just saw that the top tax rate is 45% in Japan. Link to comment Share on other sites More sharing options...
Spaceman Spiff Posted December 12, 2023 Share Posted December 12, 2023 Just now, The Evil Genius said: Yeah, you should read the comments too. Fwiw the payout period for a non qualified deferred comp has to be 10 years or more for the Ca state income taxes to not kick in, from what I've read. Also just saw that the top tax rate is 45% in Japan. I’ll prefer to think that Ohtani is a 100 mph throwing, 500 foot homer hitting, 680 million dollar tax dodging hero. I’m also sure he will have other options to live in aside from California and his native Japan in order to save the most he can. He’s got some time to figure it out. 1 Link to comment Share on other sites More sharing options...
The Evil Genius Posted December 12, 2023 Share Posted December 12, 2023 40 minutes ago, Ball Security said: His luxury tax hit is still $46M/year which, I believe, is the highest in the league. Why is it 46 and not the full 70? Or is it discounted for everyone? Link to comment Share on other sites More sharing options...
Riggo#44 Posted December 12, 2023 Share Posted December 12, 2023 2 Link to comment Share on other sites More sharing options...
bearrock Posted December 12, 2023 Share Posted December 12, 2023 40 minutes ago, The Evil Genius said: Why is it 46 and not the full 70? Or is it discounted for everyone? I think he meant for luxury tax purposes, Ohtani's contract counts as 46 mil per year. Contracts are valued at net present value, so heavy deferral brings down the aav. It's also not the financial boon that many seem to think. No one savvy with money is going to defer access to 680 mil for 10 years interest free, just to avoid 12% tax (federal tax is locked in at deferred income vesting, so he doesn't avoid that even if he moves to Japan). He saves 70+ mil, which any decent investment firm can recoup in their sleep (and a heck of a lot more) over 10 years with his annual post-tax salary. He's doing it to create more cap room for the team. Tax saving is just a little side bonus. 1 Link to comment Share on other sites More sharing options...
Ball Security Posted December 12, 2023 Share Posted December 12, 2023 57 minutes ago, bearrock said: I think he meant for luxury tax purposes, Ohtani's contract counts as 46 mil per year. Contracts are valued at net present value, so heavy deferral brings down the aav. It's also not the financial boon that many seem to think. No one savvy with money is going to defer access to 680 mil for 10 years interest free, just to avoid 12% tax (federal tax is locked in at deferred income vesting, so he doesn't avoid that even if he moves to Japan). He saves 70+ mil, which any decent investment firm can recoup in their sleep (and a heck of a lot more) over 10 years with his annual post-tax salary. He's doing it to create more cap room for the team. Tax saving is just a little side bonus. I think that’s mostly right. But I believe it’s just the deferred portion of the salary that gets calculated at net present value. For example, Judge’s counts as 40M/year over the life of his contract (according to Cots). Link to comment Share on other sites More sharing options...
The Evil Genius Posted December 12, 2023 Share Posted December 12, 2023 (edited) Fwiw the CBA does not limit the amount that can be deferred, per Jeff Passan. So the Ohtani thing is legit and player/owner approved. Edited December 12, 2023 by The Evil Genius Link to comment Share on other sites More sharing options...
The Evil Genius Posted December 12, 2023 Share Posted December 12, 2023 Link to comment Share on other sites More sharing options...
Hersh Posted December 12, 2023 Share Posted December 12, 2023 2 hours ago, The Evil Genius said: Fwiw the CBA does not limit the amount that can be deferred, per Jeff Passan. So the Ohtani thing is legit and player/owner approved. Baseball needs to change this asap. It's a massive advantage for wealthy teams to be able to defer money and it be discounted against the current luxury tax system. 2 Link to comment Share on other sites More sharing options...
Spaceman Spiff Posted December 12, 2023 Share Posted December 12, 2023 3 hours ago, Hersh said: Baseball needs to change this asap. It's a massive advantage for wealthy teams to be able to defer money and it be discounted against the current luxury tax system. Couldn’t any team defer money? Link to comment Share on other sites More sharing options...
Renegade7 Posted December 12, 2023 Share Posted December 12, 2023 23 minutes ago, Spaceman Spiff said: Couldn’t any team defer money? Sure, but the GDP of a small country to encourage signing there, nah, a lot of teams can't do that. Normally I say if you have the money spend the money. But if they can spread it out into the middle of the century long after the player has retired AND avoid the luxury tax which is only thing left compensating for no salary cap...We've gone from extremely difficult for not large clubs to keep or sign big name contracts to frankly impossible. That's a loophole and not good for baseball, imo, no matter which big market team is doing it, and you can bet money someone else will try this unless someone says or does something to stop it. It's smart...too smart... 2 1 Link to comment Share on other sites More sharing options...
The Evil Genius Posted December 12, 2023 Share Posted December 12, 2023 The deferring money isn't new. I think the Nats have been doing it with Strasberg and maybe another player. Dodgers ha e done it with a few of their players as well. The problem, to me, is the percentage. I agree with Hersh. Only a select # of teams can afford to defer that large of amount and I still don't like or fully understand why Ohtani's lux tax calc amount is discounted to 46mil instead of the full 70mil that it should be. 2 Link to comment Share on other sites More sharing options...
Ball Security Posted December 12, 2023 Share Posted December 12, 2023 2 hours ago, The Evil Genius said: The deferring money isn't new. I think the Nats have been doing it with Strasberg and maybe another player. Dodgers ha e done it with a few of their players as well. The problem, to me, is the percentage. I agree with Hersh. Only a select # of teams can afford to defer that large of amount and I still don't like or fully understand why Ohtani's lux tax calc amount is discounted to 46mil instead of the full 70mil that it should be. How many players are willing to do what Ohtani did? How many baseball guys make more in endorsements than they do in salary? And, yes, deferral payments are nothing new. Even the Orioles when they actually signed guys (Hardy. O’Day, Davis) 1 Link to comment Share on other sites More sharing options...
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