MLB players may see larger bonuses in
contracts before Jan. 1, with the election
of Barack Obama.
With the election of Senator Barack Obama as the nationâ€™s 44th president, those that play professional sports and the agents who represent may look to adjust contract structures before Obama takes office in January.
One of the president-electâ€™s main campaign promises deals with an increase in taxes for those making more than $250,000 a year, from 35 percent to 39.6 percent as it was during the Clinton administration.
This year, the MLB league minimum salary was $380,000. In 2009, that figure jumps to $400,000.
To help players get around the taxman, agents are considering the use of bonuses to get money in the hands of players before the possible change comes about under the Obama administration. As reported by Ronald Blum of The AP:
â€śItâ€™s something weâ€™ll consider,â€ť agent Craig Landis said Tuesday at the general managersâ€™ meetings. â€śBesides the federal issue, we have a state issue in some cases, anyway, where itâ€™s advantageous to take signing bonuses because of the state income tax. A Florida resident can take the signing bonus and not have to pay his teamâ€™s state tax.â€ť
In other news from the first full day of the GM meetings in Dana Point, CA, as reported by The AP:
Listing some of the Wall Street firms that have fallen, baseball commissioner Bud Selig warned GMs in a video conference about the national economy, mentioning that Bear Stearns, Lehman Brothers and Merrill Lynch have all collapsed or been take over in the past year.
â€śWeâ€™re living in a tumultuous economic period,â€ť Selig said later in a telephone interview with The Associated Press. â€śMany economists believe that weâ€™re going to have significant problems. Maybe this could turn out to be the most difficult period since the Great Depression. I view these coming months with trepidation.â€ť
Between the possible tax changes and the focus on the economy, contract negotiations will be anything but normal this off-season. With their new stadiums opening next season, the Mets and the Yankees may not feel the effects of the downturn in the economy, but others certainly will. It may take far longer to reach contract negotiations to be completed than in recent years.