lol never gonna happen nylander wants to stay a leaf he will sign it’s just a matter of time

The bonus money is as big an advantage as the low taxes and not many teams can match TO's ability to completely give bonus money

People need to stop with the taxes myth. Agents have gone on record confirming that because of tax loopholes it doesn't actually affect anything.

The whole thing is BS

Yeah, that's not how taxes work at all, especially for multi millionaires

Dallas can…and why I picked them as they have done it before (Benn, Seguin, Hintz)

That is entirely not true. There is a considerable difference in bonus money (collected in home state/province) vs salary (collected across many jurisdictions). Agents have said there is very little difference for most players, most contracts…since most are making salary only (or mostly salary).



Yeah, there is probably a starker difference as they does not account for property taxes, capital gains, deductions, etc. Wealthier household have more options for tax arbitrage, tax avoidance.

I'm taking the agents word over yours lmao

And you would be mislead.

It is a significant advantage…especially since the gap between low tax and high tax keeps widening.

Almost every player says that about the current team they are on lmao... it doesn't mean that much.

“Hopecasting”

(We are all fans)

Tbf, historically it usually costs a boatload to get a UFA to sign in a place he's never played before

There is evidence for tax stuff but not enough to make it a huge concern

For instance using Othani

He got 70m x 10 years but after taxes hes only getting 33.6m my guess for the Jays after tax 30m

Bonus money often helps with this anyway so probs will see a deal with heavy bonus money

As ironically Tkachuck breaks this mold as he was signed to his extension in Canada then went to the US. Why settle at 9.5m when you could have went to 10.5m and then went to FLA

Yah but I can see people getting into a bidding war for Nylander and him getting paid quite a lot more than what he's worth

Yeah I think if he goes somewhere other than TO it's going to be a LOT more than most ACGMs are offering. AAV goes way up when you don't have to give up draft/player capital to acquire.

10.5-11.5 in TO
12+ somewhere else.

Lots of loopholes for taxes. I know that the way the leafs were able to do the Marner contract was unique. A massive chuck of the deal was paid early, obviously teams need deep pockets for this. The advantage to this is the player can take that chuck of cash and invest it making huge returns. I believe alot of rich owners use this advantage in negotiations

No investment can guarantee returns (obviously), but there is a fairly commonly used formula to determine the present value of future cash flows using the “risk-free rate” which is usually pegged to US Treasuries. So say it’s 2%….than the value of $100.00 today = $102.00 a year from now and $104.04 two years from now.

For contracts in a cap world, even if you front loaded the most allowed up cap (still have to have $775,000 each year), there is a limit to how much that would boost the value.

Another way too look at…front loaded money may earn 2% more per year. A bad tax locale may take up to 14% more of that money.

Sorry bud, these tax differences are kind meaningless. Players at least in Canada can be incorporated for much of their income. These "personal tax rates", posted relatively meaningless. Never hear of Blue Jay or Raptors complaining about taxes but it seems to be a big thing on CapFriedly

The differences are big when dealing with big numbers.

Even if you can divert your income through a legal entity, you still need to be pay taxes if you want to use it. You can plow all your money into a trust and never pay taxes on any of it…but you also can’t spend any of it. You can hire a manager who can maximize tax avoidance…but there will still be considerable gap.

I believe in the US, taxes are paid "where" you earn them....In Canada, people pay taxes "where they reside". So, players visiting and playing in California, pay state taxes for their days in California.
So, this bit of "where the team is located" doesn't mean all that much.

Technically, you can do both in US (if you want to pay for accountants). There are some exemptions that may move the needle a little. But we would be talking a thousand here, a thousand there. Bonus money is all “where you live” income (hence my example used minimal salary figures). With any lump income like that, parts of it are probably put into trusts, for which you’d then pay yourself maximum amount each year…if you spend more that limits, it gets taxed. But again, small figures…especially considering the same strategy would be used if you lived in Texas (to minimize federal tax).

In short, when talking $80-100 million contracts…you may be giving up a net $5-10 million more in high tax state/province.

(“It’s a myth” is not best argument against my point here, because it is real and an issue for some. It is, “there are trade-offs” that are unique for every player. Nylander may want to stay a Leaf…others may look at schools, prestige, family, weather, trajectory of team, etc. Toronto checks a lot of those boxes for many…and taking home $45m in Toronto vs $50 million in Dallas may not be that important).

For discussion sake a growth stock mutual fund (basic entry level investing) would historically bring around 8-12% annually. If the option of a big payout the day the contract is signed is on the table the athlete is taking it 100% of the time. My point to all this is the advantage of early big payment gives u the option to invest big and early having the big investment make u money as early as possible and therefore offset the tax "Issues".

Would an individual rather invest 10mill today or 1mill every year for 10 years.

Any fund manager that can produce 8-12% returns a year (high alpha) but protect against downturns (low beta) is probably a billionaire. The reality is that there is a ton of risk there when the market turns against you. So 12% return growth fund sounds great, but its the high 2.0 beta (meaning when the market declines 10%….that investment is expected to decline 20%)

The most anyone can ‘count on’ is that risk-free rate….which is really the universal figure used for time-valuing money. Anything below that line is considered a loss. So in a low rate environment, say RFR is 2%….$100 today = $102.00 in one year, $104.04 in two years, $106.12 in three years.

A single investor could get 5% though mix of tax-free bonds and some high-yield equity…so maybe $100 can turn into $105.00, $110.25, $115.76! But that is on opposite side of spectrum than a growth fund.

(In short, always best to diversify away risk).

I've hear many former players on sports radio say it makes a difference. I'm going with the ones with experience in cashing these big checks