Speaking of state tax differences one of the NHL writers I follow pointed that out in comparing contracts in NY and Texas recently
Player A signed for NY for 11.5 per season his takehome pay will be 5.05 million per year
Player B signed for a Texas team for 8.5 per season and his takehome pay is 5.2 million per year
There you go….now imagine the difference on 180-200M
I think winning is a big factor here too and the Astros and Yankees are obviously two teams headed in different directions.
Found this.
Spent most of my life in Texas- now live in Tennessee…definitely lucked out with no state income tax in either state!
I lived/worked in NYC yrs ago. So there’s not just the state income tax but also a city income tax as well.
Ugh
I know it’s different than living there, but the players have to pay state and local taxes when they play in NY.
When the Astros play in NY, OH, PA, CA, etc. they are paying state and local “worked in” taxes.
Yep, the above is overstating the tax impact in 2 different ways.
First, the player on the NY team won’t be taxed for all of their games as roughly half (think the Yankees/Mets play sometimes) are played away from NY. But also, the player in TX will play some games in high tax states (e.g. the astros and rangers play ~20 games/year in CA).
“Overstating the tax impact”?
Here’s what I do know. If you live/work in NYC you have to pay:
Federal income tax
State income tax
*in '24 for example if you made over 25 mil your tax rate would be 10.9%
NYC personal income tax (PIT)
*this would be between 3.078% to 3.876%
Players pay taxes based on where they play. They don’t pay NY taxes when they don’t play there.
That’s different if you work in NYC full time. You are taxed based on where you perform services, not where you live.
And the point of my post is this is what Bregman (or any other player) would be looking at if they played for the Yankees or the Mets.
Yes, they will be hit with that for the games they play in NYC.
So for example sake.
Astros have 6/186 on the table for Bregman.
Let’s say the Yankees offered him 6/225.
Now back out the state income tax of 10.9% and let’s say the NYC/PIT is 3.5% that would be a total of 14.4%.
So 14.4% of 225 mil is 32,400,000
So the 225 mil is now down to $192,600,000
Federal income tax would be the same.
Throw in the cost of living in NYC vs Houston.
With this example the Astros offer would pretty much be identical to the Yankees offer.
He would only be hit with the state and local tax rate for the games he played in NYC. That’s half his games.
Also, the Astros play quite a few games in CA where they will pay a similar high tax rate for those games. Of course, the Yankees play some away games in high taxed states too so not sure that will end up being a material difference.
If he lives/works in NYC he’s getting taxed the full PIT along with also paying the state income tax.
What other taxes players pay when facing a team in that respective city is another topic.
That would only be true if the player were a resident of NY and NYC. I’ve been assuming they wouldn’t be in my comments because they would be crazy to do so. Athletes are generally very careful to avoid that.
If he’s not a resident, what I said above is true.
Bregman would most likely be a resident of Florida, Texas, etc.
The Sporting News has become an amateur hack site. They dream up trades and put titles in that make it sound like the, “Trade Pitch Sends Machado to Marlins for Fifteen Minor League Shortstops.”
Of course you read one paragraph its just the writer’s fentanyl-induced, psychotic wet dream.
Yikes…not a good visual
So Breggy (if he signs with the Yankees) is going to sleep at Yankee stadium? Or would he have a home/residence in NYC and thus have to pay the PIT.
You generally have to be in a state more than 183 days/year to be a resident. The question isn’t if you have an address. It’s where you spend your time. There are special rules for athletes too that spend time in different states.
That’s not that hard to avoid given players play half their games out of state. Derek Jeter was a Florida resident when he was a yankee for example.
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