Darnold loses his 178,000 dollar winners share and another 70,000 bucks

[TilloDwg]

on top of that thanks to California's jock tax. Damn commies.

Why Seahawks QB Sam Darnold lost $249K despite winning Super Bowl

Taxes on Sam Darnold’s Super Bowl salary turned his big payday into a surprising financial loss.

sports.yahoo.com

 

[champdawg.sixpack]

on top of that thanks to California's jock tax. Damn commies.

Why Seahawks QB Sam Darnold lost $249K despite winning Super Bowl

Taxes on Sam Darnold’s Super Bowl salary turned his big payday into a surprising financial loss.

sports.yahoo.com

That is criminal

 

[patdog]

A bit misleading. I actually used to prepare tax returns for a former NBA player. Every state taxes professional athletes based on days working in the state. The NBA did a really good job with this. You’re taxed in each state based on % of days in that state. So more days in CA = less % of days in event other state, so less state taxes in every other state. Also you get a credit in your home state for state taxes paid to another state. Of course with CA taxes being so high that credit isn’t 100% of the tax you paid there. So bottom line Sam Darnold ain’t hurting too much by CA taxes.

Edit: It is a pain in the arse to prepare these returns.

 

[Pars]

A bit misleading.

 

[horshack.sixpack]

That is criminal

I’m against sensational headlines that don’t tell the whole story too!

Also it’s stupid for it to work this way. Plenty of people perform part of their jobs out of town and are taxed where they live not in every state they spend any working hours.

 

[horshack.sixpack]

A bit misleading. I actually used to prepare tax returns for a former NBA player. Every state taxes professional athletes based on days working in the state. The NBA did a really good job with this. You’re taxed in each state based on % of days in that state. So more days in CA = less % of days in event other state, so less state taxes in every other state. Also you get a credit in your home state for state taxes paid to another state. Of course with CA taxes being so high that credit isn’t 100% of the tax you paid there. So bottom line Sam Darnold ain’t hurting too much by CA taxes.

Edit: It is a pain in the arse to prepare these returns.

Why do they do that?

 

[ZombieKissinger]

A bit misleading. I actually used to prepare tax returns for a former NBA player. Every state taxes professional athletes based on days working in the state. The NBA did a really good job with this. You’re taxed in each state based on % of days in that state. So more days in CA = less % of days in event other state, so less state taxes in every other state. Also you get a credit in your home state for state taxes paid to another state. Of course with CA taxes being so high that credit isn’t 100% of the tax you paid there. So bottom line Sam Darnold ain’t hurting too much by CA taxes.

Edit: It is a pain in the arse to prepare these returns.

Boomer did my taxes this year, and I had a $123k penalty and a 48% effective tax rate

 

[Bobby Ricigliano]

The NBA did a really good job with this.

I guess I missed where this was described.

 

[DesotoCountyDawg]

A bit misleading. I actually used to prepare tax returns for a former NBA player. Every state taxes professional athletes based on days working in the state. The NBA did a really good job with this. You’re taxed in each state based on % of days in that state. So more days in CA = less % of days in event other state, so less state taxes in every other state. Also you get a credit in your home state for state taxes paid to another state. Of course with CA taxes being so high that credit isn’t 100% of the tax you paid there. So bottom line Sam Darnold ain’t hurting too much by CA taxes.

Edit: It is a pain in the arse to prepare these returns.

So explain it like I’m 4. Did he pay more than he made or not?

 

[jethreauxdawg]

So explain it like I’m 4. Did he pay more than he made or not?

Yes, and they took his firstborn.

 

[Pars]

Yes, and they took his firstborn.

False.
Got to keep first but has to name him Gavin

 

[johnson86-1]

So explain it like I’m 4. Did he pay more than he made or not?

California (and most if not all states) treats athletes as earning a percentage of their salary equal to the percentage of days they spend working in their state. Generally a not crazy approach for the regular season. But they treat the playoffs as contributing equally to their salary, when in reality their salary doesnt go up, and they only get some marginal extra compensation. So by pretending they are earning their salary in the playoffs rather than just counting the marginal pay they’re actually earning, California and other high tax states get to screw them and they end up paying more in state income taxes than they actually earn in the playoffs. You’d think somebody would be able to successfully challenge that but I assume they have tried and failed.

ETA: I think technically basically any executive of a multi state company is skirting state taxes but states don’t worry about it because the extra revenue isn’t worth it and it would be a major hassle for voters in their state also. It’s basically entertainers and athletes that have to deal with it and only athletes get screwed I think.

 

[patdog]

So explain it like I’m 4. Did he pay more than he made or not?

No.

 

[johnson86-1]

No.

How are you doing that math?

 

[patdog]

How are you doing that math?

Because Boomer isn’t taking into account the fact this will reduce his state taxes in every other state the Seahawks will play in this year, or the state taxes credit in his home state.

edit: if he played in a state like Texas with no income tax Boomer may be right. But there’s no chance of a team from Texas making the Super Bowl.

 

[seshomoru]

So explain it like I’m 4. Did he pay more than he made or not?

If you look at it like he was only paid $178,000 for winning the Super Bowl, then yeah, net loss of $71m. To look at it that way you have to say that none of his $40mil salary plus $4mil in bonuses was earned in that game. In other words, you are comparing the cost of a common tax event that applies to a player's total salary (higher in CA than other states yes) to a very small bonus (relative to his income) he got in one game.

 

[patdog]

And I think the bigger issue the players union should look at thd issue of why to players only get paid $178,000 for winning the Super Bowl? I’d be holding out over that.

 

[seshomoru]

And I think the bigger issue the players union should look at thd issue of why to players only get paid $178,000 for winning the Super Bowl? I’d be holding out over that.

I think it was part of the collective bargaining. There's like a $450mil+ performance-based pool of money that all players earn from based on playing time, base salary, etc. Lower salary scale players on crappy teams can almost double their salary. Lower scale players on good teams can as well, with playoff bonuses being a little extra gravy. They spread the wealth.

 

[dudehead]

So, he made $40 million this year and owes a pro rata state income tax for playing in the Super Bowl that fully credits to his home state income tax owed and people are pissed and thinking he got screwed? I don't follow.

 

[mcdawg22]

So if college players become salaried employees, how many opt outs are you going to see at the Rose, Fiesta, Pinstripe etc bowls where they have jock taxes?

 

[patdog]

So if college players become salaried employees, how many opt outs are you going to see at the Rose, Fiesta, Pinstripe etc bowls where they have jock taxes?

I think the colleges have caught on to opting out of bowl games and now backend their contracts so if you don't play the bowl game you don't get paid as much.

 

[patdog]

I think it was part of the collective bargaining. There's like a $450mil+ performance-based pool of money that all players earn from based on playing time, base salary, etc. Lower salary scale players on crappy teams can almost double their salary. Lower scale players on good teams can as well, with playoff bonuses being a little extra gravy. They spread the wealth.

So there's another pool of money he can draw from for the Super Bowl. Which makes sense. Otherwise he's getting paid a lot less for winning the Super Bowl than he's paid for playing in a regular season game.

 

[paindonthurt]

Boomer did my taxes this year, and I had a $123k penalty and a 48% effective tax rate

Damn Zombie. What did that gross income look like?

 

[johnson86-1]

Because Boomer isn’t taking into account the fact this will reduce his state taxes in every other state the Seahawks will play in this year, or the state taxes credit in his home state.

edit: if he played in a state like Texas with no income tax Boomer may be right. But there’s no chance of a team from Texas making the Super Bowl.

So it looks like ignoring the reduction of income to other lower tax states (i.e., if you just pretend all of the reduction comes from the home state and you assume he didn't have additional incentive pay not being reported), Darnold would have broken even if his marginal home tax rate was 3.79%. If it's lower than that, he actually paid more in extra taxes than his extra incentive pay. If it's higher than that, he still made some money.

So basically players on teams from Florida, Tennessee, Texas, Nevada, Arizona, Indiana, Pennsylvania, Washington, would have paid more in extra taxes than they earned.

Players on teams from Georgia, Illinois, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, New York, North Carolina, WIsconsin, DC would have come out slightly ahead.

Still should be a constitutional violation for earning more money in a state to reduce your total take home pay.

 

[paindonthurt]

So explain it like I’m 4. Did he pay more than he made or not?

No.

He got taxed on his overall income times (number of days spent in california) divided by 365.

So lets say he made $26,000,000 and spent 25 days in cali "working". 25/365 x 26,000,000 = $1,780,821 is taxable income for CAli state taxes. Times 13% is $231,506.

 

[patdog]

So it looks like ignoring the reduction of income to other lower tax states (i.e., if you just pretend all of the reduction comes from the home state and you assume he didn't have additional incentive pay not being reported), Darnold would have broken even if his marginal home tax rate was 3.79%. If it's lower than that, he actually paid more in extra taxes than his extra incentive pay. If it's higher than that, he still made some money.

So basically players on teams from Florida, Tennessee, Texas, Nevada, Arizona, Indiana, Pennsylvania, Washington, would have paid more in extra taxes than they earned.

Players on teams from Georgia, Illinois, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, New York, North Carolina, WIsconsin, DC would have come out slightly ahead.

Still should be a constitutional violation for earning more money in a state to reduce your total take home pay.

I really think the way these players are taxed is ridiculous and too complicated. Regular season should be 100% taxed in the state you're based in. Sure states will lose tax revenue from visiting team players, but they'll get twice as much from home team players, so should break even. Playoff money should be taxed in the state earned in, so for example Darnold's CA income should be $178,000 and his CA income tax would be about $14,000 (probably a bit less).

 

[mcdawg22]

I think the colleges have caught on to opting out of bowl games and now backend their contracts so if you don't play the bowl game you don't get paid as much.

Now I’m thinking about the NCAA tournament and UCLA regionals. lol

 

[johnson86-1]

I really think the way these players are taxed is ridiculous and too complicated. Regular season should be 100% taxed in the state you're based in. Sure states will lose tax revenue from visiting team players, but they'll get twice as much from home team players, so should break even. Playoff money should be taxed in the state earned in, so for example Darnold's CA income should be $178,000 and his CA income tax would be about $14,000 (probably a bit less).

Kind of surprised there hasn't been a reciprocity agreement back in the day (now it'd be too political). I guess that would put the high tax states at a bigger disadvantage in free agency, and maybe they'd come out behind on playoff revenue if they are historically hosting more than they're playing away? But superbowls are pretty evenly split between high tax (California) and low tax (FLorida) states, although Louisiana is 3rd. It makes sense for performers where you won't just have reciprocity, but basically every state would seem to end up in the same position over time if they adopted your approach.

 

[HRMSU]

Because Boomer isn’t taking into account the fact this will reduce his state taxes in every other state the Seahawks will play in this year, or the state taxes credit in his home state.

edit: if he played in a state like Texas with no income tax Boomer may be right. But there’s no chance of a team from Texas making the Super Bowl.

I think that last sentence just sent me to my tranquility room....dang Jerah

 

[TilloDwg]

Apparently, it not only applies to the athletes, but also anyone on the team payroll, ie coaches managers, equipment guys, clubhouse employees, etc......


https://cpataxmag.net/breaking-news-stories/1969-jock-taxes-in-21-states-and-8-municipalities

 

[horshack.sixpack]

If you look at it like he was only paid $178,000 for winning the Super Bowl, then yeah, net loss of $71m. To look at it that way you have to say that none of his $40mil salary plus $4mil in bonuses was earned in that game. In other words, you are comparing the cost of a common tax event that applies to a player's total salary (higher in CA than other states yes) to a very small bonus (relative to his income) he got in one game.

You aren't likely to motivate much political outrage with that information. Good thing you aren't a headline writer.

 

[o_Hot Rock]

Why do I care what a man making tens of millions of dollars has to pay some taxes? He aint' in my tax bracket.

CA taxing the rich a lot more than others makes freaking sense to me. All these tariffs are a tax on the poor, I would much rather a higher tax on the rich. Beisdes:

This guy is going to make millions in endorsements from the winning the game. People are hating the wrong things.