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Sports Tax Man Advises Athletes
Originally published on Tue July 10, 2012 7:52 am
LINDA WERTHEIMER, HOST:
Turning, now, to professional sports. It's the off season for basketball and hockey and teams are wheeling and dealing, making trades, hoping to land star players. The athletes want the best deal too, and some of these very young millionaires clearly need advice.
NPR's Kevin Leahy consulted an accountant who calls himself the Sports Tax Man.
KEVIN LEAHY, BYLINE: Last week, point guard Steve Nash was on the market. Nash is Canadian, beloved in his home country. And the Toronto Raptors wanted him badly.
UNIDENTIFIED MAN #1: It's Nash going home and finishing his career in Canada, how nice is that? So...
UNIDENTIFIED MAN #2: He just signed a deal to work with basketball Canada and they are located in Toronto. So he'd be...
RAY RAIOLA: The way I like to look at it, he'll receive 50 cents on a dollar.
LEAHY: That last voice belongs to Robert Raiola, CPA. On Twitter, he's known as Sports Tax Man. Raiola ignored the Prodigal Son storyline and referred to a new Canadian tax law.
RAIOLA: In 2012, the top rate in the province of Ontario is 48 percent. In 2013, the top rate will be 49.5 percent.
That means Nash would pay more tax in Toronto than if he signed in, say, California. Suddenly a big offer from the Raptors doesn't look quite as enticing. Raiola doesn't work for Steve Nash, but it's his job to think this way. He calls himself a financial quarterback.
Advice on buying cars, you know, looking after insurance on jewelry, disability insurance if they have a big contract, possibly, coming up. We also do a lot of tax compliance.
LEAHY: Raiola doesn't reveal who his clients are, but he's making a name for himself on Twitter. A colleague got him involved last summer.
RAIOLA: He said to me only twits don't tweet and it's really not a thing that a lot of CPA's do.
LEAHY: Visit the Sports Tax Man's page and you won't find his photo. Just a simple clip art image of some sports equipment and thousands of tweets calculating players' earnings per game, per inning, per point.
RAIOLA: Pitcher Cliff Lee won his first game of the year. He has made $10,750,000, per win, so far this year. On a $3 million a year salary he's only going to pay $66,000 in state tax. Ray Allen has made approximately $176 million on the court in his career. He's been paid $7,672 per point. Joey Chestnut reportedly made $10,000 for 10 minutes work at a Nathan's hot dog eating contest. Next year, Jeremy Lin will earn $15,243 per quarter, which is 12 minutes.
LEAHY: So Raiola focuses on players' salaries but he also explores financial minutiae - Per diem meal allowances, capital gains on memorabilia sales, tax write-offs for league fines.
WERTHEIMER: Here's what Raiola tweeted after an NFL player's recent DUI arrest.
RAIOLA: If he is suspended for any games in the 2012 season, he will lose $470,588 per game.
LEAHY: Just cold hard numbers. No snark, no soul-searching about athletes as role models. Raiola doesn't think people want that from him.
RAIOLA: America is fixated, not with accountants, America is fixated with money and with professional sports.
LEAHY: Twin fixations the Sports Tax Man knows well.
As for Steve Nash, the Canadian? He wound up signing with the Los Angeles Lakers. He'll play with Kobe Bryant, soak up the sunshine and avoid those steep Canadian taxes.
Kevin Leahy, NPR News.
(SOUNDBITE OF SONG, "TAXMAN")
THE BEATLES: (Singing) 'Cause I'm the taxman, yeah, I'm the taxman. Be thankful I don't take it all. 'Cause I'm the taxman, yeah I'm the taxman.
WERTHEIMER: You're listening to MORNING EDITION from NPR News. Transcript provided by NPR, Copyright National Public Radio.