Official 2015 Free Agency/Contract Extension Thread

[ThunderDan]

True and false. Yes for people making "normal" money. But when you hit AMT level (as all pro athletes likely do) - those deductions often don't exist.

Sales/Property taxes are much higher in states without income tax - but these guys aren't buying 10M homes (yearly) to account for the difference.

Sorry, but you are mistaken on the AMT. The majority of athletes earning W-2 wages would not be in the AMT unless they have other sources of income from very specific sources. The AMT top tax rate is 28% and the top athlete's are paying 39.6%. The regular tax is much higher than the AMT amount.

The sad part of the AMT is it hits the people making 200K-500k which is not the original intent of the law.

[Fosco33]

Sorry, but you are mistaken on the AMT. The majority of athletes earning W-2 wages would not be in the AMT unless they have other sources of income from very specific sources. The AMT top tax rate is 28% and the top athlete's are paying 39.6%. The regular tax is much higher than the AMT amount.

The sad part of the AMT is it hits the people making 200K-500k which is not the original intent of the law.

Fair point. Lets just agree the IRS sucks. For the highest paid NFL athletes looking to sign on day one of FA, I'd guess state income tax is a question.

[ThunderDan]

Fair point. Lets just agree the IRS sucks. For the highest paid NFL athletes looking to sign on day one of FA, I'd guess state income tax is a question.

Let's just say that the IRS allows us to have an army and roads and a whole host of other necessary and unnecessary services.

[ThunderDan]

Let's just say that the IRS allows us to have an army and roads and a whole host of other necessary and unnecessary services.

Take this to FYI if you want to continue!

[Fosco33]

Let's just say that the IRS allows us to have an army and roads and a whole host of other necessary and unnecessary services.

Ahhh... we can have those services without a completely burdensome collection agency (granted - that is just followed flawed policy). But the IRS seems to be married too closely to politics and has moved away from it's true purpose. Allowing loopholes and not taxing the wealthy while killing the middle/upper middle class...

[Patler]

Sorry, but you are mistaken on the AMT. The majority of athletes earning W-2 wages would not be in the AMT unless they have other sources of income from very specific sources. The AMT top tax rate is 28% and the top athlete's are paying 39.6%. The regular tax is much higher than the AMT amount.

Aren't professional athletes considered independent contractors with 1099 income as opposed to W-2 wages? Does AMT apply to 1099 income? Probably doesn't matter anyway, because after going through the test they likely will have paid enough anyway. As you said, those who fail the AMT test and have to pay extra are usually the moderately well paid more than the highly paid.