FissionFire
Registered User
So would deferred payments count against the players share of HRR for escrow? Would they be subject to clawback as well? Could see this causing escrow to skyrocket again if so which was a major issue for players before.
It’s 3 million.Dundon is cheap.
Oh wait.
Cap circumvention by any sane definition.Technically correct, but completely divorced from the mechanics of what is actually happening.
That 3.2 doesn’t exist, it never existed. People would be better served imagining that instead of a (say) 9M deferred bonus they’re getting in year 9, they’re deferring a (say) 5.8M bonus form year 1 that is getting paid out with interest in year 9. It’s only a cap discount if you only care about payment numbers and not at all about payment structure.
By deferring money, the player is taking a less valuable contract, by any reasonable definition. Of course the cap hit should be lower.
Over 8 years, 400k annual.Isn’t Carolina saving 3.2 million with Jarvis? Or is your threshold a million per year?
No Vancouver is paying OEL varying amounts because of signing bonuses.Buyout payments are spread out over 2x the number of years remaining. For example Vancouver is paying OEL $2.416M / year through 2030-31, even though the contract was scheduled to expire after 2026-27.
It’s cap circumvention.It's not really a loophole, it's just another way of asking a player to take less money. In Ohtani's case there were tax implications, so maybe some teams/players will try and take advantage of that?
All of the money paid to Jarvis will be factored over the 8 years of the contract, the fact that the deferred money is calculated lower today for cap purposes is because the deferred money has less present day value by being deferred
No Vancouver is paying OEL varying amounts because of signing bonuses.
I hate this deferred stuff but tbh as a sharks fan, this is a perfect time to introduce a new way to circumvent salary crunches because we’ll need it in a few years.
Being a consistent winner helps keep the stadium packed, the merch selling and the playoff revenue rolling in.I remember when the Canes, during the dark time known as the Karmanos regime, had internal budgets in the years after the Stanley Cup. It's refreshing to see the Canes growing into a large-market team with large-market-worthy cap gymnastics.
No, it's not. They're providing money that is worth less to the player. It'd be insane to have it on the cap at the same number.Cap circumvention by any sane definition.
Seems a bit nit picky for a block, been here 20 years never blocked anyone.gonna block you rather than get in trouble for expressing my opinion of you.
Japan’s heavy tax structure will be over 50% of his contract.I'm sure they've tried but didn't find guys willing to defer.
The only time it really works as an advantage for the player, is taxes.
Using the Ohtani contract with teh Dodgers for example, Without deferring money, he'd be paying about $10m per year in state taxes on a 10 year/700m, instead he's gonna make $2m per year for the next decade and defer 68m per year and pay probably less than 250k in state taxes. If he moves to a state with no state tax when that contract expires, he'll only have to pay federal taxes on it and gain about $65m+
Two challenging points to your post:- didn’t care about getting the maximum he could
- became one of only two players active in the league to take a contract where his actual contract money is greater than his team’s cap hit times years of contract.
It looks like he took the maximum he could be agreeing to let his team break the cap rules. They wouldn’t have had the cap room to give him this much money if he didn’t and they had to pay him without a cap loophole reducing his cap.
One of the key overlooked details of this situation is that Carolina's GM, Eric Tulsky, went to both the NHL and the NHLPA to ensure that everything was within the bounds of the CBA. He got the approval, likely with Slavin's deal and only expanded on it w/the Jarvis deal.It’s cap circumvention.
1) This deal would be $7.9M AAV without the deferred money.- didn’t care about getting the maximum he could
- became one of only two players active in the league to take a contract where his actual contract money is greater than his team’s cap hit times years of contract.
It looks like he took the maximum he could be agreeing to let his team break the cap rules. They wouldn’t have had the cap room to give him this much money if he didn’t and they had to pay him without a cap loophole reducing his cap.
It’s 3 million.
Great explanationI think people are making a bigger deal about this than it really is. At the end of the day it isn't really making a difference in what the player makes, which is why the CBA would allow for it.
Let's say a player gets a $10mil signing bonus on day one of the contract. It counts as $10mil on the cap spread over the life of the contract. He sticks it in an account that earns some interest and in 8 years that account is worth about $12mil.
What happens in the deferred scenario is the team says we'll pay you a signing bonus but instead of now we'll pay you at the end of the contract, we'll keep the money in our account earning interest for 8 years and then pay you $12mil. That costs the team $10mil in today's money so the CBA allows it to count as $10mil, just like in the first scenario.
Same cap hit and player has the same money in pocket in the end.
Precisely; which is why Deferred Salary under this scenario can help "high tax jurisdictions" compete under the Salary Cap with "low tax jurisdictions".Couldn't a player reap large tax benefits from this, say Leon Draisaitl after he retires gets citizenship in say ... Switzerland (next door to Germany) ... he could effectively pay a shit ton less tax on that deferred salary.
Because this requires the player to take less money. Because they get the money later.Why haven’t other teams done this?
But players would much rather $$$$ today instead of tomorrow..Had no idea you could defer money and it’s insane the the richer teams never use it.
How did you determine a discount rate to bring down the NPV of the Y7 lump sum bonus payment of 4.55M to 4.03?Total payment over Slavin's contract is $51.69M. Which would be a $6.461M AAV.
Per reports the year 7 bonus of $4.55M is being deferred to year 9. This causes the NPV of the year 7 bonus to be $520k lower, for a total of $4.03M against the cap.
The total valuation of the contract is thus reduced to $51.17M, which comes out to a $6.396M AAV.
The Jarvis contract will follow a similar principle, we need to know which years the money is being deferred from to determine NPV.