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Tax Could Be In Play With Steven Stamkos Contract

from Joe Smith of the Tampa Bay Times,

if accurate, the $8.5 million annual average ($1 million more than his current salary) would put Stamkos eighth in the league, shy of the $10 million that Kings star Anze Kopitar signed for this month, and $2 million less than the supposed benchmark of the $10.5 million each for Blackhawks stars Jonathan Toews and Patrick Kane.

Was it a lowball offer from the Lightning? Not so fast. The Tampa Bay Times dug deeper into the numbers, with the help of nationally renowned sports tax guru Robert Raiola, revealing potential x-factors: no state income taxes in Florida and the Lightning's ability to guarantee an eighth year on the contract. Raiola calculated that if Stamkos takes $8.5 million with the Lightning, it would net almost the same annually as $10 million in New York, presuming he'd be a New York City resident (see chart). He'd net roughly $500,000 less annually than $10 million deals in St. Louis or Detroit, due to city and state taxes, but take in more money over the length of his contract.

In Toronto, Stamkos' hometown, there's a proposed 53.53 percent federal/provincial tax if he's a Canadian resident. So even if the Maple Leafs offer $10 million annually, Stamkos would net $7 million less total over the length of the deal compared one at $8.5 million annually in Tampa Bay, partly thanks to an eighth year. Stamkos would even make just $1.4 million less total than Kopitar over his eight-year deal with the Kings, assuming Kopitar is a California resident.

read on

Filed in: NHL Teams, Tampa Bay Lightning, | KK Hockey | Permalink
  Tags: steven+stamkos

Comments

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Ahh, what a great point.

Posted by George0211 on 01/26/16 at 09:41 AM ET

awould's avatar

I assume if he takes this deal by that logic he’d list the Florida Panthers as his only acceptable trade destination.

Posted by awould on 01/26/16 at 09:46 AM ET

Avatar

Great, but how much would he make if they gave him an 8-year, $10M per year deal?

Posted by Garth on 01/26/16 at 11:17 AM ET

Tripwire32's avatar

Posted by awould on 01/26/16 at 08:46 AM ET

I think also both Texas and Tennessee have no state income tax, not sure about city income tax

Posted by Tripwire32 from Kay He Mar Heart on 01/26/16 at 01:09 PM ET

Canucklehead's avatar

Great, but how much would he make if they gave him an 8-year, $10M per year deal?

Posted by Garth on 01/26/16 at 10:17 AM ET

Perhaps he’s trying to help keep additional players in Tampa by keeping his cap hit a bit lower?  Extra $1.5M could go a long way in keeping the core together.

Posted by Canucklehead from Ottawa, Ontario on 01/26/16 at 03:13 PM ET

Mistercristo's avatar

“Wait, Detroit offered him $10 million???  Take it, you idiot!!!1!!”

  - Someone, somewhere

Posted by Mistercristo from Cameron Frye's garage, circa 1987 on 01/26/16 at 03:56 PM ET

gowings's avatar

Wow..Nice to know. Thanks for posting it!

Posted by gowings from MTL on 01/26/16 at 04:20 PM ET

Avatar

Extra $1.5M could go a long way in keeping the core together.

A long way?

How about asking the lesser talented guys to take discounts instead of the world-class, elite, all-star offensive stud?

Posted by Garth on 01/26/16 at 05:17 PM ET

Canucklehead's avatar

A long way?

How about asking the lesser talented guys to take discounts instead of the world-class, elite, all-star offensive stud?

Posted by Garth on 01/26/16 at 04:17 PM ET

That’s already happening.  How many vets were on PTOS this year?  How many vets took paycuts just to get signed?  A heck of a lot.  A lower cap for your superstar player is always preferable.  You think the Kings or Hawks wouldn’t kill to get their guys signed for that price?

And, as the article says, his potential $8.5M is quite comparable to the Toews, Kane and Kopitar contracts considering the tax rate.

Posted by Canucklehead from Ottawa, Ontario on 01/26/16 at 06:46 PM ET

pautna's avatar

This reminds me of a tactic a car salesperson would use. (Remember folks, don’t discuss financing until you’ve settled on the actual amount of the vehicle.) As others have pointed out, he can (and most likely will) get traded at some point, so how do you factor that in?

As far as paying taxes in general go, when your making that much money you hire a high end tax attorney to explore the many ways you can get a lot of the money back. It’s the American way. So the whole thing strikes me as a bit of a shell game.

Posted by pautna on 01/26/16 at 08:38 PM ET

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Paul Kukla founded Kukla’s Korner in 2005 and the site has since become the must-read site on the ‘net for all the latest happenings around the NHL.

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