Do NY State Income Taxes Hurt the Bills?

[DabillsDaBillsDaBills]

These threads pop up every now and then. Taxes aren't as simple as saying if you make 1 mil in New York you'll pay 8% more in taxes than someone making 1 mil in Florida. 

 

There's other factors to consider. If a professional athlete plays in NYC or LA they garner much more media attention and have a better chance at landing lucrative endorsement deals. 

 

I'd be surprised if any professional athlete has ever decided to not sign with a team in New York state because of the state tax rate. 

[Mr. WEO]

2 hours ago, billsfan89 said:

 

 

I think you grossly overestimate state taxes. I think California has the highest state tax and it's in the range of 10% at the highest income bracket. No state takes 20% of your money via income tax. No matter what you still have to pay federal taxes. And up until Trump !@#$ed over everybody you use to be able to write off your state and local taxes fully against your federal taxes, which for high gross income earners deeply helped alleviate that cost. 

 

Also I think that as another poster mentioned that you get taxed by which state you play your games in. I would also add in the fact that a lot of teams in higher taxed states have no issues recruiting players. 

 

No, SALT is a deduction.  It is subtracted from your income to arrive at taxable income.  It isn't subtracted from your Federal taxes.

[Real McClappy]

3 hours ago, Badthingsman said:

If I am free agent X and I have a choice between signing with the Dolphins, where there are no state income taxes or signing with the Bills, I have to imagine that I am going to have to ask for more money from the Bills to cover the cost of my income taxes.  So at the end of the day that will eat more into the salary cap and the Dolphins have a huge advantage.  Does the NFL adjust for this in the salary cap in any way?    Yes.  I am bored.  

Try this out OP. 

I plugged in a 5mill salary in Buffalo. You would need close to 6mill in Florida to live at the same standard.

Buffalo to Boston, you would need 7.5 mill to equal 5 mill in Buffalo.

You can't go by state taxes but cost of living as a whole IMO. This is actually a strength for smaller market teams.

https://www.bankrate.com/calculators/savings/moving-cost-of-living-calculator.aspx

Edited December 31, 2017 by Real McCoy

[klos63]

3 hours ago, MAJBobby said:

Doesnt seem to hurt the California Teams getting Talent does it?

I think location is more important than taxes.

[MAJBobby]

6 minutes ago, klos63 said:

I think location is more important than taxes.

 

Agree also though taxes themselves are a small factor. And wont really affect any cap your talking maybe an extra 500k-1M on the cap for huge contracts over the life of said contract

[Orlando Tim]

To argue that the New York income tax is not a disadvantage to Buffalo in at least a small way is being naive. There are a lot of cities that basically pay an additional 5% more than Buffalo. Tiger Woods left Cali for Florida mainly due to tax rates. Lastly NY taxes your income if you are a resident for more than 180 days. Unless there a special exemption for athletes Richie incognito pays the 8% on his whole income to the state of NY and an additional amount to Mass. for his game there and all of the other states that tax athletes this way. I have personally had to deal with the 180 rule and know several people who deal with same thing. 

[jimmy10]

3 hours ago, billsfan89 said:

 

 

I think you grossly overestimate state taxes. I think California has the highest state tax and it's in the range of 10% at the highest income bracket. No state takes 20% of your money via income tax. No matter what you still have to pay federal taxes. And up until Trump !@#$ed over everybody you use to be able to write off your state and local taxes fully against your federal taxes, which for high gross income earners deeply helped alleviate that cost. 

 

Also I think that as another poster mentioned that you get taxed by which state you play your games in. I would also add in the fact that a lot of teams in higher taxed states have no issues recruiting players. 

 

Lol, facts. Like those matter anymore. 

[Captain Caveman]

3 hours ago, Badthingsman said:

 

I have to imagine it hurts any team that is in a state that has high income taxes.  Why would you play in NY and pay 20, 30, 40% of your salary to the state when you could go to Florida and keep it all.  

 

In what state do you pay 20% (not to mention 30 or 40%)?

 

In NY I believe top rate is 8.82%

[frostbitmic]

3 hours ago, MAJBobby said:

 

Because Bills players only pay NYS Tax on 9 game checks. 

 

MIA only gets tax free income on 8 game checks 

Why would a member of the Bills pay state income tax to NYS when playing an away game vs the Jets ?

[Captain Caveman]

3 hours ago, Badthingsman said:

 

I know.  That is a big deal and it hurts not only the players but anybody in the building trades.  

 

Check your spelling.  Simple math.  I have an equal offer from a Florida team or the Bills.   Unless you are a moron you take the offer from the Florida team.   

Where is the simple math that allowed you to come up with 40% in state income taxes.

[MattM]

1 hour ago, Mr. WEO said:

 

No, SALT is a deduction.  It is subtracted from your income to arrive at taxable income.  It isn't subtracted from your Federal taxes.

 I think you knew what he meant--SALT used to be fully deductible (with possible fade outs for high earners), but now it's capped at $10k, which is a pittance when talking about salaries in the multiple hundred of thousands or more.  Trump did indeed %*^# just about everyone in NY on that.....

[What a Tuel]

 

This is a non-issue unless someone brings some evidence that everyone is signing to Houston/Dallas/Jacksonville/Miami/Seattle/Tampa Bay, and not to all the other states with personal income taxes.

Edited December 31, 2017 by What a Tuel

[Tuco]

Yes it matters. But it's actually  extremely complex because different states have different rules. Yes, if you live in Florida you get 8 home games tax free. If you live in other states you get taxed on all your income if you reside there, except in some cases where a player plays a game in New York or Massachusetts and also pays taxes there. Then states give a tax credit, or a rebate on the home state because the money was earned and taxed in a different state, but only up to a certain amount. And many states have many different rules. Then there's money made for endorsements which aren't necessarily made in the state they live in, which is why a lot of players may play in Buffalo but actually list their official address in some other state. The whole time Thurman Thomas played in Buffalo his address was listed as Sugarland, Tx.

 

So basically there's going to be a myriad of tax ramifications that will take a professional to handle no matter where they live. A concern? Sure. But probably not as much as was mentioned earlier about keeping the wife happy, etc. And yeah, what's the state tax on a million? $65,000 or something? So go to a good team and your first playoff game takes care of whatever extra taxes there may be.

 

For NFLers, they should just be glad they aren't NBAs or MLBs where they have to play dozens of games in different states and countries. Just Google the Jock Tax and see just how ridiculously complex it gets.

[Murdox]

Bear in mind that the individual AMT was reinserted into the final bill (the Senate and House disagreed initially on whether the individual AMT would survive).  If you are subject to the AMT, as most high-income earners are, you will not be able to take SALT deductions anyway unless you could perhaps claim it as a business expense (see more about that below).  So, it won't be functionally much different than before, although the AMT rates have gone up slightly.  The inability to deduct SALT is much more of a hit to those in the middle class who didn't meet the AMT threshold. 

 

Moreover, the highest income earners don't really care because they are getting big tax breaks via (1) 2.6% off of the highest marginal rate - 39.6% down to 37%; (2) higher threshold for inheritance tax; (3) benefits to offshore tax shelters and repatriation rates; and (4) deduction for pass-through income such as brand revenue, rental income, etc.  They are also usually still able to deduct quite a bit of SALT off of their rental properties and other business income, as they may qualify as "operating expenses" as far as that's concerned.  Thus, overall, I highly doubt that the high-income earning NFL players will lose much playing in NY, although it would still make sense for them to establish residency in a state with no inheritance tax at some point like Trump in Florida.  The NY state inheritance taxes are terrible!

[Tcali]

6 hours ago, billsfan89 said:

 

 

I think you grossly overestimate state taxes. I think California has the highest state tax and it's in the range of 10% at the highest income bracket. No state takes 20% of your money via income tax. No matter what you still have to pay federal taxes. And up until Trump !@#$ed over everybody you use to be able to write off your state and local taxes fully against your federal taxes, which for high gross income earners deeply helped alleviate that cost. 

 

Also I think that as another poster mentioned that you get taxed by which state you play your games in. I would also add in the fact that a lot of teams in higher taxed states have no issues recruiting players. 

so its Trumps fault that people cant have the fed govt subsidize state taxes in mostly bankrupt states?..And who knows maybe CA,NY,or Ill(venezuela) will get mad now and up their taxes to the previously mentioned 20,30 or 40% rates.Altho I doubt that will reduce their massive deficits and debt one bit.

[Irv]

So it is a fact that the NY taxes hurt the Bills.  Thank you.  

[Call_Of_Ktulu]

I would say Taylor's Total passing offense ranking is way worse than a 15% tax when it comes to bringing in FA WR's.

[Doc Brown]

3 hours ago, Badthingsman said:

So it is a fact that the NY taxes hurt the Bills.  Thank you.  

I think the cold weather, a smaller rust belt city with not as many things to do compared to bigger cities, and a franchise that hasn't done much winning lately plays a bigger role.  You are correct in that NYS taxes does hurt the Bills though.

[Peter]

9 hours ago, Badthingsman said:

If I am free agent X and I have a choice between signing with the Dolphins, where there are no state income taxes or signing with the Bills, I have to imagine that I am going to have to ask for more money from the Bills to cover the cost of my income taxes.  So at the end of the day that will eat more into the salary cap and the Dolphins have a huge advantage.  Does the NFL adjust for this in the salary cap in any way?    Yes.  I am bored.  

 

I believe you are correct.  I also know that this has been discussed/mentioned in the past when the Dolphins are pitching free agents and when guys sign down here.  

 

 

[Chimp]

15 hours ago, billsfan89 said:

 

 

I think you grossly overestimate state taxes. I think California has the highest state tax and it's in the range of 10% at the highest income bracket. No state takes 20% of your money via income tax. No matter what you still have to pay federal taxes. And up until Trump !@#$ed over everybody you use to be able to write off your state and local taxes fully against your federal taxes, which for high gross income earners deeply helped alleviate that cost. 

 

Also I think that as another poster mentioned that you get taxed by which state you play your games in. I would also add in the fact that a lot of teams in higher taxed states have no issues recruiting players. 

I can still write mine off.  Pa resident.  You don't have to stay where you are do you?  Come to PA