State Taxes And The Salary Cap

[rangerous]

1 hour ago, CTJetsFan said:

Corporations do it now. Some have regional salary ranges for the same job which I'm sure factors is based on cost of living (of which local income taxes are a part)

The government does based on the state or regions cpi.  I’m not sure where their base value is located but people can expect a twenty percent pay bump for living in California.  This is also true for the per diem rates the government pays based on location. A place like San Diego is much higher than a place like Jacksonville or Norfolk.

[Larz]

1 hour ago, TuscanyTile2 said:

It doesn't matter if the cap uses pre-tax numbers.  The key thing is that the players know there's going to be a difference in their income if they sign with the Jets as opposed to Miami, Tampa, Houston or Dallas (FL and TX having no state income tax).   That could affect their decision of where to sign, giving some teams an unfair advantage over others.

They are taxed based on where the game is.  Charge the thread title to free agency. Holy sh*t 😂

[TuscanyTile2]

13 minutes ago, Larz said:

They are taxed based on where the game is.  Charge the thread title to free agency. Holy sh*t 😂

I think you're still not getting the point.  Not that I wanted that scvmbag, Tyreek Hill, but the Jets would've had to pay more than the Dolphins did to compensate the player equally.  That means he would've taken up a higher percentage of our salary cap than he would for Miami.

EDIT: I don't understand why you're bringing up "They are taxed based on where the game is".  Obviously, if a player signs with the Jets, he's going to play a minimum of 8-9 games in NY.  

[Sperm Edwards]

2 hours ago, Larz said:

Don’t they pay taxes based on the location of the game ?

these aren’t capital gains. Where did that come from? 😂

they can’t even look into forming an S corporation without making them owners. 

Yes the bolded is true.

However where it really comes into play is bonus money. Bonus money is treated like a game check like any other wages. So if a player gets a $30MM signing bonus (and then 2 years later a $20MM roster/option bonus) that's $50MM taxed at his team's state level. If that team's home state is FL, TX, WA, NV, or TN then the player pays no state tax on it. If NJ (Jets aren't NY for tax purposes) you're talking about ~$5MM; D.C. and others are similar; and in CA I think it'd be over $6MM. The tax is progressive but when you're talking about such large bonus checks that progressive range up to several hundred thousand or so becomes a smaller & smaller percentage of the total, so in effect they're more or less fully taxed at the marginal rate. Also since state taxes are no longer deductible on federal taxes it's basically cash. Any of our resident accountants here can confirm, but I think this is right.

On the one hand, the guys at the top end make so much it's a quality of life decision (including the quality of life playing for a good team vs. a crappy one, since the latter will [generally] get one fewer national endorsement deals as well & it's not worth the misery, too). On the other hand the higher up they get the more significant the disparity is. $5MM in cash - over a span of what, like 1-4 years? - is a lot of money to any player. 

 

1 hour ago, TuscanyTile2 said:

Neither of the 2 instances (this being one of them) where you accused me of "talking politics" is accurate. Discussing the salary cap implications of state taxes is not "politics".  Neither is discussing the safety of a certain "medical intervention" (no matter how much you want it to be the case).  The NFL had (and probably still has) specific rules related to that medical intervention, btw, that could include forfeiting games and player pay.   

The problem is you chose to use the term "red states" when the reality is there are are blue & purple states (Washington, Nevada) that also have no state income taxes (and others with low state taxes).

If you'd merely used the language "some states" instead of "red states" it would've avoided this.

[Maxman]

I locked this, and I agree totally with what Sperm said above. This thread was done from the start with the red state \ blue state talk.