Around the League Thread | Ixnay on Zerplanyay

[MarkusNaslund19]

Bingo.

People kept going on about the 'failed core' when it hadn't failed at all and the reason the team had failed was bad coaching, bad management and lack of direction, and bad depth and supporting cast. And rather than trying to do fairly easy things to fix what was happening around our outstanding core players, people wanted to blow it up for a 50% chance that 6-7 years from now we might have core players that good again, with the same issues building a team around them.

Oh yes. I was having the same arguments and it felt like trying to kick water uphill.

 

[Vector]

 

[arttk]

turns out whatever agent was right and there are ways to get around taxes for rich folks

 

[Vector]

Kyle Stich, from AFP Analytics, has a really interesting thread on the tax situation and Tavares.



He points out what the main problem for Tavares is he's a Canadian resident and this loophole is meant for non-residents.

 

[credulous]

yeah my reading of that article is that tavares improperly declared his residency status when filing not that the cra has reinterpreted how signing bonuses are taxed

the retirement compensation agreement stuff seems like it doesn't really impact athletes except in as much as there seems to be a technical disagreement about how much income can be deferred when you are a non-tax resident. this might impact non-resident athletes but i don't think it applies to resident athletes

 

[Jyrki21]

yeah my reading of that article is that tavares improperly declared his residency status when filing not that the cra has reinterpreted how signing bonuses are taxed

As a general rule of thumb, I've found almost all reporting on legal matters tends to miss the actual point in the hopes of driving interest/outrage from people who want to talk about the broader subject matter, not the decision/amendment under scrutiny itself.

 

[Hit the post]

yeah my reading of that article is that tavares improperly declared his residency status when filing not that the cra has reinterpreted how signing bonuses are taxed

the retirement compensation agreement stuff seems like it doesn't really impact athletes except in as much as there seems to be a technical disagreement about how much income can be deferred when you are a non-tax resident. this might impact non-resident athletes but i don't think it applies to resident athletes

A multi-millionaire should be able to afford to hire a good tax accountant to handle his income taxes.

 

[RandV]

What's also missed in the discussion here is I don't know what the exact details would be but I'd imagine Tavares could make a lot more $$$ in sponsorship deals playing in Toronto than he could in tax breaks playing for say Florida.

Personally I'd say this is a singular millionaire tax case and doesn't have any broader implications for Canadian NHL teams.

 

[StreetHawk]

A multi-millionaire should be able to afford to hire a good tax accountant to handle his income taxes.

That would mean his Tax person messed up. No way any pro athlete, especially at his level of earnings, would do their own taxes.

 

[AlainVigneaultsGum]

 

[arttk]

yeah my reading of that article is that tavares improperly declared his residency status when filing not that the cra has reinterpreted how signing bonuses are taxed

pretty sure that is not accidental. you can declare non residency as long as you don't live in Canada for more than 183 days a year. I am guessing if he doesn't stay in Canada in the offseason and with the amount of road games per year, he probably meets the condition to be a non-resident.

 

[Hodgy]

I don't practice tax law but I did take income tax law in law school, and I recall that the test for residency isn't one of days per year or anything, but a wholistic test based on all the relevant factors. The fact that he's born and raised in Toronto, and plays in Toronto from October to May (with games on the road) is probably why the CRA is taking the position that he is a Canadian resident for tac purposes. I also assume he has a nice cottage in Ontario that he spends at least some time at during the summer.

 

[Bojack Horvatman]

View attachment 896643

Doable if he changes the difficulty to very easy

 

[Vector]

pretty sure that is not accidental. you can declare non residency as long as you don't live in Canada for more than 183 days a year. I am guessing if he doesn't stay in Canada in the offseason and with the amount of road games per year, he probably meets the condition to be a non-resident.

I don't practice tax law but I did take income tax law in law school, and I recall that the test for residency isn't one of days per year or anything, but a wholistic test based on all the relevant factors. The fact that he's born and raised in Toronto, and plays in Toronto from October to May (with games on the road) is probably why the CRA is taking the position that he is a Canadian resident for tac purposes. I also assume he has a nice cottage in Ontario that he spends at least some time at during the summer.

 

[Hodgy]

This particular tax treaty / exemption may stipulate a particular day threshold, but this isn't the case for general legal analysis for tax residency in Canada as I understand it.

 

[credulous]

i had to reestablish canadian residency a few years ago (for tax reasons, ironically) and it's definitely not as simple as 'spend 183 days in a calendar year in canada'. i had to jump through hoops (buy property, open an office in vancouver, establish banking relationships) to prove i was a legitimate resident and not someone who was just trying to create a favorable tax situation

 

[arttk]

So yeah looks like he f***ed up but filing for non residency wasn’t some accident

 

[JAK]

In such a dispute like this, the simplest answer is the best answer, somebody screwed up.

Who? Tavares's agent and tax accountant most likely. This likely would be a study case for all agents and professional athletes advisors going forward, mostly about planning for UFA and possible tax liabilities.

Governments are not going to adjust a deal purely because one single athlete's advisors didn't understand the rules.

 

[credulous]

rich people (especially the 'self made' ones) are really bad at listening to advice even when they are paying for it

tavares probably just didn't take advice to watch his time in canada carefully seriously and his tax person either took him at his word he was a non-resident (tax people don't generally verify this kind of thing. you need a separate tax lawyer to do it which tavares probably didn't bother retaining or failed to loop in if he had access through his management) or got told to file as a non-resident and they'd figure it out later in the courts if it came up

95% sure this is a case of someone figuring they could pay to make their problem go away and disregarding the advice they got that would have prevented the situation

 

[StreetHawk]

rich people (especially the 'self made' ones) are really bad at listening to advice even when they are paying for it

tavares probably just didn't take advice to watch his time in canada carefully seriously and his tax person either took him at his word he was a non-resident (tax people don't generally verify this kind of thing. you need a separate tax lawyer to do it which tavares probably didn't bother retaining or failed to loop in if he had access through his management) or got told to file as a non-resident and they'd figure it out later in the courts if it came up

95% sure this is a case of someone figuring they could pay to make their problem go away and disregarding the advice they got that would have prevented the situation

Hard to say that exactly. But, his agent likely had to be working alongside or had contact with a tax specialist and should have discussed what Tavares needed to do in order to qualify for their desired outcome based on the structure of the contract they were looking for from Toronto as the other options were all US cities, so same old for him.

Who knows if his people laid it all out for him in terms of what he needed to do for that first year or not.

 

[Bleach Clean]

For me it's because I spent multiple offseasons arguing with people who wanted to blow this team up and start another rebuild, and those people were continually citing the Wings/Yzerman as the 'ideal' of a team doing things right because they were winning the Prospect Pool Cup and the Most Draft Picks trophy every year.

I don't particularly care about the Wings/Yzerman specifically (and I think he's actually just a pretty average GM), it's just that this situation is playing out pretty much exactly how I was telling people it would at the time, and showing how difficult it is to get from 'OMG LOOK AT ALL OUR PROSPECTS' to being an actual good team with actual NHL impact players driving the bus.

Fans act like tanking is this guaranteed formula for success and retooling on the fly is stupid and guaranteed to fail but Detroit is Exhibit 1A for how you can do everything 'right' in a tank and nothing is guaranteed. And like I tried telling the video games people for years, there are reasons that teams only tank like this as a last resort.

I had no idea that's why you were chastising the Yzerplan. Odd.

I'm not sure your point holds regardless because Yzerman definitely did not do everything right in a tank: He didn't secure a 1C or a 1G. Even a lower end tandem of Horvat + Larkin could have saved him.

Tanking is no guarantee. It never was.

What's interesting to me is that you can see Yzerman close off DET's ceiling by placing middling bets. VAN has done something similar by allocating their cap toward DeBrusk instead of an elite talent like Guentzel (or potentially growing a talent like Guentzel). The ideal has been forgone for the reality of a quick retool. Now we see if that lowered ceiling can be propped up by the depth to win it all.

 

[strattonius]

I had no idea that's why you were chastising the Yzerplan. Odd.

I'm not sure your point holds regardless because Yzerman definitely did not do everything right in a tank: He didn't secure a 1C or a 1G. Even a lower end tandem of Horvat + Larkin could have saved him.

Tanking is no guarantee. It never was.

What's interesting to me is that you can see Yzerman close off DET's ceiling by placing middling bets. VAN has done something similar by allocating their cap toward DeBrusk instead of an elite talent like Guentzel (or potentially growing a talent like Guentzel). The ideal has been forgone for the reality of a quick retool. Now we see if that lowered ceiling can be propped up by the depth to win it all.

You're out of touch.

Signing Compher, Copp, Chiarot, or Holl (and I'm probably missing a few) is not the same as Jake Debrusk. And anyone that compares the two has made a mistake in their player analysis.

Not saying Debrusk is a world beater but when you factor in their contracts with age & upside, almost EVERYONE immediately predicted that the aforementioned group of Wings players were terrible signings.

 

[Hit the post]

Hard to say that exactly. But, his agent likely had to be working alongside or had contact with a tax specialist and should have discussed what Tavares needed to do in order to qualify for their desired outcome based on the structure of the contract they were looking for from Toronto as the other options were all US cities, so same old for him.

Who knows if his people laid it all out for him in terms of what he needed to do for that first year or not.

Wasn't that one of the reasons Tortorella had a residence in Port Roberts vs Vancouver? (I'm assuming it was for "tax purposes"?

 

[Vector]

Wasn't that one of the reasons Tortorella had a residence in Port Roberts vs Vancouver? (I'm assuming it was for "tax purposes"?

Messier too.

 

[arttk]

Hard to say that exactly. But, his agent likely had to be working alongside or had contact with a tax specialist and should have discussed what Tavares needed to do in order to qualify for their desired outcome based on the structure of the contract they were looking for from Toronto as the other options were all US cities, so same old for him.

Who knows if his people laid it all out for him in terms of what he needed to do for that first year or not.

when you pay agent like 8% or something like that, I am guessing it doesn’t cover just getting you the contract and some other endorsement deals. modern sports agents services probably includes tax, financial management stuff and other services.