Phillies Will Save Bryce Harper Tens Of Millions In Taxes
By landing with the Philadelphia Phillies instead of any number of teams in less tax-friendly states, Bryce Harper could end up saving tens of millions in taxes alone, The Finger Lake Times reports. Three teams — the Los Angeles Dodgers, the San Diego Padres, and the San Francisco Giants — top the list in terms of where state taxes will take the biggest bite out of an athlete’s paycheck — or anyone else’s for that matter.
Harper’s deal with Philadelphia could translate to even bigger bucks than the numbers in the contract suggest, as Pennsylvania’s modest 3.07 percent flat state income tax pales in comparison to higher tax states like California. In California, a progressive tax structure means a larger share of taxes are paid based on the more you make, with Harper’s income easily landing him in the top bracket, which maxes out at a highest-in-the-country 13.3 percent for the highest taxed income.
That means that a substantially larger piece of the $330 million contract with the Phillies will make it to Harper’s bank account, potentially totaling tens of millions of dollars over the course of the 13-year contract.
“With a contract of that magnitude, it’s dramatic,” said Harper’s agent, Scott Boras. “It could be almost a full year’s compensation. The Giants, Dodgers and Padres are in the worst state income tax jurisdiction in all of baseball. Players really get hit.”
Regardless of which state Harper landed in, few of his baseball colleagues would likely sympathize with his tax situation, considering his contract represents the largest free agent deal in any sport in North America, ever.
Bryce Harper won't be shy about recruiting in Philly. pic.twitter.com/tGoTTW74OY
— SportsCenter (@SportsCenter) March 5, 2019
Taxes notwithstanding, it has been reported that the Giants offered 12 years and $312 million before being told that they needed to make up for the larger bite of California taxes. An offer from the Dodgers was similarly affected.
One Agent, Jason Boggs, has said that in his experience, the tax factor can absolutely influence a player’s decision to sign with a given team.
“It’s a red light,” he said. “I’ve had players in the past say they don’t want to go to certain states because they’re going to get hammered by taxes. Obviously, that affects the bottom line.”
It has also been reported that, maximizing bottom line take-home pay aside, Bryce also had another ambition: land the biggest contract in Major League Baseball history. So given that this was accomplished regardless of the tax situation that would follow, Pennsylvania’s low flat state income tax rate just makes for more icing on the cake.
