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Related: About this forumShohei Ohtani's contract with the Dodgers could come with bonus of mostly avoiding California taxes
SACRAMENTO, Calif. (AP) If $700 million wasnt enough, Shohei Ohtanis record-setting contract with the Los Angeles Dodgers could also include a bonus: skipping most of Californias famously high income taxes.
Not even the mighty Dodgers have the power to exempt Ohtani from paying his taxes. But they and the player can control when Ohtani gets paid. The Dodgers will pay Ohtani $20 million over the next decade, when the baseball star will be hitting and, health permitting, pitching for the National League powerhouse.
Its the decade after that when the Dodgers will really start to pay Ohtani $68 million per year from 2034-43. Ohtani will turn 40 in 2034, an age when most Major League Baseball players have retired. By then, Ohtani could stop playing baseball and choose not to live in California, potentially avoiding for the bulk of his salary the states 13.3% income tax and 1.1% payroll tax for State Disability Insurance.
With 97% of Ohtanis Dodgers income deferred, it means California where there is an estimated $68 billion budget deficit this year will have to wait at least a decade before it can collect taxes on the bulk of his salary, if it can collect at all. California could collect taxes from Ohtanis significant endorsement deals, assuming Ohtani is a California resident.
https://apnews.com/article/shohei-ohtani-taxes-california-budget-deficit-7c9b5752d7734908853db407f7441a1f
madaboutharry
(41,358 posts)Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming are states without a state income tax.
He might not want to move back to Japan since taxes are higher than in the U.S.
rurallib
(63,201 posts)for some expenses he just accrued.
WestMichRad
(1,812 posts)ProfessorGAC
(69,898 posts)Japan has a flat tax rate of 10% for almost every region or municipality.
So he may be avoiding California income taxes, but I don't think he's avoiding paying taxes.