I could care less either way

NardDogNation wrote:

BRIGGS wrote:They both took less and look where they are. Carmelo will not take the 5 yer deal--hell find an opportunity especially after he talks to these guys

To be fair, Dwight's never going to win a title with this Rockets team as constructed. Incidentally, they are not much better than the team in Orlando that he was fighting to leave and he gets marginalized just the same.

I doubt that Melo takes less than a 5 year deal. This will be his last major deal so I expect him to pursue every guaranteed cent because tomorrow is no longer certain.

Rockets look damn good right now and they're getting better. If Harden doesn't go hero ball this is going to end up being the 2nd best team in the west by the end of the year.

As for Melo, I think he'll take less. I actually predict him to. I just don't think it will be here. When he takes less, it'll be for a team with a plan or pieces in place to contend immediately. If the Knicks want to sell him on winning here, they better do everything the can to shed salary, get a PG, etc. Start with trading the most overrated player in history Tyson Chandler.

Also LJB had Bosh/Wade and how much did they leave on the table? Not much. Dwight didnt leave anything on the table... maybe 2%. I dont really see the coorelation.

fishmike wrote:difference is this: LBJ and Dwight both have another max contract ahead of them. Carmelo does not. There is no impact because Dwight or LBJ are getting a max 5th year, and 6th and 7th... Melo + 4 years = 34. Whats he getting then?

Also LJB had Bosh/Wade and how much did they leave on the table? Not much. Dwight didnt leave anything on the table... maybe 2%. I dont really see the coorelation.

CrushAlot wrote:

fishmike wrote:difference is this: LBJ and Dwight both have another max contract ahead of them. Carmelo does not. There is no impact because Dwight or LBJ are getting a max 5th year, and 6th and 7th... Melo + 4 years = 34. Whats he getting then?

Also LJB had Bosh/Wade and how much did they leave on the table? Not much. Dwight didnt leave anything on the table... maybe 2%. I dont really see the coorelation.

Agree. One other big difference at least in regards to LBJ and Melo. LBJ pays no state income tax in Florida. Melo pays NYS income tax and NYC income tax. They essentially make the same money after state and city taxes. A very unfair advantage for states that don't have state income tax. Also, I am pretty sure Texas is another state that doesn't have state income tax. This really is an area where the playing field in the nba needs to be leveled.

NBA players pay a tax in whatever state they play in, so I don't know if the lack of state tax in Texas and Florida makes a difference.

NardDogNation wrote:

CrushAlot wrote:

fishmike wrote:difference is this: LBJ and Dwight both have another max contract ahead of them. Carmelo does not. There is no impact because Dwight or LBJ are getting a max 5th year, and 6th and 7th... Melo + 4 years = 34. Whats he getting then?

Also LJB had Bosh/Wade and how much did they leave on the table? Not much. Dwight didnt leave anything on the table... maybe 2%. I dont really see the coorelation.

Agree. One other big difference at least in regards to LBJ and Melo. LBJ pays no state income tax in Florida. Melo pays NYS income tax and NYC income tax. They essentially make the same money after state and city taxes. A very unfair advantage for states that don't have state income tax. Also, I am pretty sure Texas is another state that doesn't have state income tax. This really is an area where the playing field in the nba needs to be leveled.

NBA players pay a tax in whatever state they play in, so I don't know if the lack of state tax in Texas and Florida makes a difference.

How pro salaries are taxed

Professional athlete salaries, like real estate, are all about location, location, location.

The lion's share of most players' income, their salary, is taxed in the city and state where the team is based. But income from other sources, including endorsements, personal appearances, dividends and interest income, is taxed in their state of residence.

[Video: Friday's can't-miss NCAA tournament games]

This is the reason New York Giants quarterback and Super Bowl MVP Eli Manning lives in Hoboken, N.J., instead of in the Big Apple. It's simple arithmetic, says Raiola.

"If he were a resident of New York, he'd pay 8.97 percent New York state tax and another 3.78 percent New York City tax on top of that, not only on his wage income but also his endorsements and investment interest," he says. "In New Jersey, he only pays 8.97 percent."

"Jock tax" assessments to players by away-game jurisdictions are credited back to the player in their state of residence but only to the maximum rate in their home state. Players who live in the nine states without state income tax (Alaska, Florida, Nevada, New Hampshire, Tennessee, Texas, South Dakota, Washington and Wyoming) pay full fare on "jock tax" assessments, Raiola says.

The 'jock tax'

Taxing states and some municipalities impose a "jock tax" on visiting professional sports players in one of two ways. Most use the "duty days" method, which divides the player's total number of work days during the season by the number of days spent playing in the state. A few use the "games played" method, which divides the total number of games in the season by the number played in the state.

And just to give accountants gray hairs, no two states do it exactly alike.

[Related: Megatron becomes Megabucks: The NFL's new highest-paid receiver]

"They all agree on the fraction; they just don't agree on what goes into the numerator and the denominator," says Losi. "Some jurisdictions treat practices and OTAs (organized team activities) as a working day. Others say that if you travel but don't play, that doesn't count."

All those state filings can make for one doorstop of a tax return.

"Thank God for e-filing," says Raiola. "In the old days, a player who lived in California not only had to file in all of those different states but was required to provide a copy of each state return with his federal return. The average NBA player could pay tax in 20 states."

The invisible hand of taxation

Taxes -- or the lack of them -- may also have had something to do with NBA all-star and 2010 free agent LeBron James' choice to play for the Miami Heat instead of the New York Knicks. Losi points to Florida's lack of a state income tax.

"That may have been one of the factors that led LeBron to choose Florida versus New York," says Losi. "Ten percent of his first contract was going to be the difference. For him, it was an extra 5 (percent to) 9 percent difference in tax. That's real money."

But Raiola says what works for a megastar such as LeBron may not be the best move for journeymen players.

"If you live in Florida, the taxes you pay to those other states is really taking money out of your pocket because you're not going to get a credit for those state taxes," he says. "If you live in a nontax state, you could easily end up paying state tax on 60 (percent) to 65 percent of your earned income from the team, even though you don't have a tax in the state you reside in."

Big money, bigger taxes overseas

Professional golfers, tennis players and other athletes who compete on the world stage often leave a third or more of their earnings in the local coffers.

"Whenever they play in foreign countries, they have to pay taxes in that jurisdiction, and the tax liability is much bigger than the 5 (percent) to 10 percent state tax. It's usually in the 30 (percent) to 40 percent bracket," says Losi. "Usually it's withheld in their prize money, and they can file a nonresident return if they think they might have a refund coming."

[Related: World's richest basketball coach wins high school title]

Because the United States is one of the few countries that taxes all personal income regardless of source, some pro sports stars who compete internationally actually have a financial disincentive to make their home in America.

"If they're (not U.S. citizens or green card holders) and they're not planning to stay here more than 183 days out of the year, from a tax perspective it absolutely makes sense to not live in the U.S.," says Losi. "All the foreign golfers who come here to play, if they want all of their foreign prize money and endorsement money to be taxed, all they have to do is hang out here for 183 days."

The Canadian tax treaty

The tax treaty between the United States and Canada preventing double taxation for those who cross the border for work can complicate tax planning for Canadian-based NBA, NHL and MLB players. (There are no NFL teams north of the border.)

This is because Canada's top tax rate of 48 percent is 13 percent higher than the U.S. maximum (35 percent), and Canada taxes individuals based on their residency while the U.S. taxes people based on citizenship.

"As a result, it's advantageous for Canadian players to move to the U.S.," says Losi. "That's what a lot of the NHL guys do. As long as you don't have Canadian-source income, you don't pay Canadian tax, you save 13 percent on every dollar, plus there are a lot more deductions and credits in the U.S."

While the reverse is often true for U.S. players signed to Canadian teams, Raiola sees a solution to help even out the tax discrepancy.

[Related: Tony La Russa might run Dodgers if billionaire Steve Cohen buys]

"Get a signing bonus from a Canadian team, which under the treaty is only taxed at 15 percent," he says. "Canada withholds 15 percent, you get a full credit, pay the 20 percent down here, and you're not penalized for playing for a Canadian-based team."

I think the capped leagues need to go a more corporate structure in this regard. Salaries should be cost of living adjusted it makes no sense that teams can pay more by paying less. It's actually kind of laughable that a billion dollar organization has this kind of stuff going down. I love the Knicks but getting players here is a tough sell. Greater scrutiny, horrible management, and less money. Not really a great pitch.

dk7th wrote:some of these players make 20 million a year. unimaginable yet trying to think pragmatically... a man doesn't need more than x amount a year to live well and provide for a family and descendants. it's an ego trip for some and an example of low character. for others they realize that winning takes sacrifice of several different kinds and money viz a viz value viz a viz winning is a central part of this.

"tax implications?" what utter rubbish!

Fidel Castro and. Joseph Stalin agrees with you, unfortunately u live in the United States of America???

Bonn1997 wrote:

CrushAlot wrote:
The lack of state tax makes a huge difference. With city and state income tax Melo makes $170,000 less annually then LBJ.

How awful!

In all seriousness the NBA should account for this as it does give an unfair advantage in recruiting.