Winning Share after Taxes

[Pantherhawk]

Phil Mickelson is moving out of California to Florida soon and he will save about $5M a year in state income taxes, lol.

This is a highly dubious claim. Phil's income from his endorsement contracts relates to his play on Tour. As such, the income should be allocated by the days he plays in the various states (and countries) on a pro rata basis. Changing his residency does not affect this math. His income completely unrelated to golf may be taxed at a higher rate, but I would be surprised if that's in the neighborhood of $50M+ per year. If it is true, it's likely due to wanting to get out of certain investments that would trigger substantial capital gains.

 

[Chef23]

I'm very familiar with those rates as we lived there for 20 years until two years ago. So, so glad to be out of California!

I thought Massachusetts taxes were bad but we don't get as high as California.

 

[Bernoulli]

The Taxman taketh.

 

[GolferDad66]

Most states that charge a state income tax, will charge its residents state tax for earnings outside of Cali as well. If you get hit with a tax outside of Cali (say you win the US Open in NY, and pay NY tax), you get to offset the NY tax off your Cali taxes. But since Cali taxes are more than every other State tax you end up always paying the 13% even if you offset other state taxes.

 

[MrDC]

The big chunk goes to the feds, that's the issue, so while 13% sucks you're living in Cali, it's nice, those places that take next to nothing have nothing, who wants to live in the middle of nowhere? boooring, maybe one golf course? I'll pay a bit more to have a dozen courses to play within driving range.

 

[Duffer Waldorf]

who wants to live in the middle of nowhere?

 

[JB]

The big chunk goes to the feds, that's the issue, so while 13% sucks you're living in Cali, it's nice, those places that take next to nothing have nothing, who wants to live in the middle of nowhere? boooring, maybe one golf course? I'll pay a bit more to have a dozen courses to play within driving range.

I wouldn't call FL, TX and TN having nothing and certainly not short on golf courses.

 

[MrDC]

I wouldn't call FL, TX and TN having nothing and certainly not short on golf courses.

True, but it's like living in hell most of the year, way too hot, everyone there has to be done playing golf by noon, in Cali you can play all day and watch the sun set, perfect golf weather.

 

[MattyD-MPLS]

That is a crazy amount to get taken away for taxes.

 

[Flipit]

California tax sucks I’ll be the first to admit that but the major part of that is the Fed tax.

 

[SlightDraw]

It's only money man. Legendary wins live forever.

 

[JB]

True, but it's like living in hell most of the year, way too hot, everyone there has to be done playing golf by noon, in Cali you can play all day and watch the sun set, perfect golf weather.

Not really, but what would that say about NY then weather wise, since you said you would pay a bit more for more courses?

 

[Duffer Waldorf]

everyone there has to be done playing golf by noon

59* and a sweater in August is not what I'd consider "perfect golf weather".

 

[fuffle master]

i sure will gladly take the 990,000 but damn a million in tax is crazy.

 

[Joshnoble01]

Work from home with Convid plus 13.3% is making Incline Village and Nevada look more appealing every day.

 

[Joshnoble01]

Really? How so? If I hire a maid, gardener, electrician, or even a caddie, I don't pay them out of preextortion funds. I'd pay the extortionist, then pay them, then they'd pay the extortionist again.

I don't know it for sure but I would imagine a Caddy is a 1099 employee from your business. Not quite the same if that's the case. Kind of how you can write those fees off if they occur in a second home that is a rental from your business.

 

[davis20]

This makes me think of i was a pga tour player if he trying to lobby players to get the pga to stay out of those ridiculously high tax states. Same if I was a pro player of another sport, I wouldn't want to play where I'd be taxed to death. Now granted I know you don't have a tremendous amount of say where you go.

Sent from my SM-G960U using Tapatalk

 

[BigMac]

Ouch. One of the many, many reasons I fled California and would never go back.

 

[billyh]

True, but it's like living in hell most of the year, way too hot, everyone there has to be done playing golf by noon, in Cali you can play all day and watch the sun set, perfect golf weather.

You can adjust to the heat fairly easy. Just take a gallon of water with you. On the plus side, you can play golf year long in most southern states.

 

[Molten]

Isn’t it really the federal government that is the big winner? His federal rate would be close to or over 40% with that amount.

 

[93civiccpe]

That sounds like Robbery!

 

[Thrillbilly Jim]

The Federal Government- “NO, I WON THE PGA CHAMPIONSHIP!”

 

[fupresti]

I am absolutely amazed that anyone with a really high income would stay in California.

There is a reason why a U-Haul is cheap if you are moving to California and expensive if you are leaving.

 

[Bernoulli]

Isn’t it really the federal government that is the big winner? His federal rate would be close to or over 40% with that amount.

Yes. but the federal tax liability is a given. What is interesting for the golfers is what states they are going to owe income taxes in.

The taxman is going to get his share. Only questions are whether it's going to be the feds and the state and how much.

 

[Space Bandito]

Some might, but many like my wife and me after spending 20 years in CA would not choose to live in there even if it had zero income tax. Most of our California friends have already moved or are planning to when they retire. Many of them just moved up the hill 75 miles to the Nevada side of Lake Tahoe. A few of them kept their California home/condo but spend more than six months living in Nevada. The same goes for most of our Minnesota friends who are or will be snowbirds when they retire, they spend at least 183 days in Florida to avoid the high(9.85%) MN state income taxes. We certainly will do that as soon as my youngest is off to college.

Phil Mickelson is moving out of California to Florida soon and he will save about $5M a year in state income taxes, lol.

I agree. I doubt I'll be here forever, but it's hard for me to imagine living anywhere else in the US. There's nothing quite like the Pacific Ocean in my book.