Your math is completely flawed. I'm going to try and work through your own numbers you've posted, feel free to add any corrections.
You state player in Tampa takes home $10m at 37% tax rate. That requires a salary of $10m/(100%-37%) = $15.9m salary.
Yet you keep using $10m salary as the baseline for the Toronto player when you should be using $15.9m instead. Let's say Toronto player with $15.9m compensation is able to put $12m of that compensation into the RCA and takes home 50% of the remaining $3.9m for $1.95m in pocket and $12m tax deferred. That deferred money could eventually be taxed at %'s as low as 10-15% depending on nationality, where they setup residence, and could ultimately lead to a net future take home for the tax year of $12m+, much better then Florida.
Of course there are a ton of nuances and details in this tax planning, but you don't seem to be interested in understanding them, nor discussing them.
sorry why can’t I use 10 million as an example? If a player gets paid 5-10-15 million.... it’s still the same principle.
Option A: take home money advantage. Today. Money in pocket today.
Option B: much less take home money today. To TRY to mitigate some of that damage you have to
-lock up most of your money
-decide on where you want to move in 15 years....when you may have endorsement/employment opportunities/young family.
-pray the laws don’t change
- be subject to back taxes at any time.
that doesn’t sound at all equal to me. The vast majority of NHL players don’t make marner money. They have greater expenses then we do. The ones who do are unlikely to want to drive a civic and live in a townhouse. They probably want to spend/have their money now. Rather than hope to get it years from now
The fact is we can sit here all day as people who don’t have this money and aren’t making these decisions. But it’s theory vs practice..
there are volumes of NHL players coaches GMs accountants and agents who agree with me
That
1.) no state taxes are a huge advantage
2.) we see no state tax teams getting much better deals, that often provide the exact same take home for less.
one agent has agreed with the RCA model. He is “controversial” at best, and most of his clients just so happen to be in tax free markets.
honestly. If anyone can really argue that they can make a convincing plan for high market teams to get tax free cap hits.... how much would Toronto/Montreal pay for that? Why do they not know about it.
the leafs literally own the raptors. Who were banned from this RCA strategy. So they obviously know about it. Why can’t they use it? Wouldn’t the biased Toronto media be going on about how RCAs allow players to make more?
NHL players who played in Toronto and low tax markets are on the radio here every day. Many have talked about how much more they made in Florida etc.
not one has ever said that they were able to use RCA to bridge the gap...... why ?
