People talk about income taxes on these multimillionaires like they actually pay them. They have so many legal ways to not pay income tax and instead pay capital gains in whatever state they want to at a later date. They just have to roll their income into some investment in another state, sit on it for a few years while it grows and then just pay the taxes required by the federal government and if they do it right... that's it. The rich get richer and pay a smaller percent of what they make in taxes, if they handle it in a smart way.
With increased LA endorsements Luka might ultimately net more money. I mean its not like Dallas is a small market - but LA is of course bigger and the Lakers brand is by far #1. Lots of Lakers fans have never fully embraced LeBron. They might be happy to get behind Luka the next decade. Even if he doesn't get as much money in the long run - I have a hard time thinking of anything meaningful you can do with $350 million that you can't do with $250 million.
Luka will still be lighting his cigars with hundred dollar bills. Think of those endorsements...I hear B&B TV and Liquor is looking for a new spokesperson.
That's how investment income can work, sometimes. But, there aren't those kinds of shelters for wages and salary. Doncic will be a California resident. He'll play 41 games at home, and that half of his salary will be subject to CA income tax. He'll play 12 of 41 road games in California, so over 65% of his salary will be taxed at 13%. He'll play 2 games in Arizona which has a 2.5% flat tax. He will play either 1 or 2 games in Oregon and be subject to a 9.9% rate he will 6 or 7 games a year in Texas and Florida so around 8% of his income won't be subject to state tax now I'm not sure how all of his endorsement income will be classified. I'm guessing most of it would be routed thru an LLC. But the corporate tax rate in CA is 8.8%. Texas does not levy corporate taxes. income can't be sheltered by capital gains rates, as far as I know. That's usually from sale of assets
I was suspicious Cronin got rolled over in negotiations such as the Clippers trade and especially his first year and Blazer GM/interim GM. But he's by far light years better than Nico Harrision. Hell even John Nash, Rich Cho, and Steve Patterson were all light years better than Nico Harrision. Trading away a generational 25 year old MVP player who was far more successful than Michael Jordan at similar ages is just beyond reason.
Nobody here can have precise enough knowledge of exactly what taxes Doncic will pay. He could have business with ordinary income losses that reduce his taxable income on salary and wages for example. We also don't even know that he will be a California resident. Odds are he will be, but he doesn't have to be. We do know that all the income from his home team games will yes be taxed at a much higher rate in CA than TX.
about the hypothetical losses: it doesn't change anything. He'd have those losses as a Texas resident but he'd have no state income tax to offset as far as residency, I'm pretty sure the special IRS provision that allows professional athletes to be taxed by various jurisdictions where games are played require residency in the state of the employer. If athletes had that kind of illogical tax dodge, every player in the NBA & NFL would be a Texas or Florida resident as I said, there are all kinds of shelters and loopholes for investment income. LLC's have different tax rates, in different states, but there will still be some liability
Losses probably would have no impact but nobody here knows that. They could apply to a specific state. The IRS doesn't care what state you are or are not taxed in - the IRS is for federal taxes and applies to income in all states (as well as abroad). States all have their own laws on tax nexus. There are no set "LLC taxes" as that entities activity can be included on an individual, partnership, C Corp, or S Corp return. LLC also don't have to be only investment income. Often times they have no income and huge assets, or have pure operating income only.
Nobody is talking about federal taxes. The rates are the same in all states C-Corps pay corporate tax rates. S-Corps are generally pass-thru, meaning they get taxed at individual rates. Some states, like CA do tax S-Corps (In CA it's a 1.5% tax vs 8.8% for C-Corp). The s-corp tax paid is applied as a credit against the remaining tax liability for the pass-thru individual here's how I understand it: Doncic will be taxed as a CA resident; if it's not for the balance of this season (but probably will be), it will be for next season * In CA the top individual tax rate is 13.3%. In Texas, it's 0%. (CA's tax rate will apply to 65% of his salary) * In CA, the corporate and C-Corp tax rate is 8.8%. In Texas it's 0% * In CA, the S-Corp tax rate is still 13.3% apportioned between Individual and S-Corp. In Texas, the S-Corp rate is 0% * In CA, capital gains are taxed as ordinary income and for Doncic would be subject to that 13.3% tax rate. In Texas there is no tax on capital gains the capital gains tax might be one area where some dodging is allowed. From my own experience, it's pretty damn hard to dodge Oregon's tax man. I'm assuming CA is just as aggressive and wide-sweeping. I'm pretty sure that in all states, members of an LLC are subject to the 15.3% SS and Medicare taxes. Doncic will be well above the 176K cap on SS taxes, so that's irrelevant. I don't think there's a cap on Medicare's 2.9% tax; maybe. But those are federal taxes that would impact the same in any state
