Floyds "tax issue" for the year, for possibly not fighting in 2010?

[THE REED]

Reed can u please expose who came up with or is agreeing with this silly excuse?

To be completely honest I cannot remember specifically... I was in about 30 different threads early yesterday afternoon... and I kept seeing the tax excuse pop up randomly... some from members I didn't even know.

[TOBYLEE1]

I have seen people around here saying that if Floyd fights Pac in 2010... that his earnings for the fight... in addition to his earnings for the Mosley fight would push him into the next tax bracket.

This would make Floyd want to wait until 2011, so that the Pac fight earnings do not push him into the next bracket, and he would pay a higher percentage.

I myself am someone who has been saying this...


After doing some research (because I am not a tax expert).


There is actually a ceiling on the federal tax brackets..

In other words... once you make a certain amount per year... your tax percentage does not increase... should you continue to make more.

Depending on what you make, you fall into a certain criteria.. such as follows:

10% - $0 – $8,375

15% - $8,376 – $34,000

25% - $34,001 – $82,400

28% - $82,401 – $171,850

33% - $171,851 – $373,650

35% - $373,651+


35% seems to be the federal ceiling tax bracket.

In addition, Nevada (where Floyd lives) Does not have State income Tax.

With the Shane Mosley fight, obviously Floyd is already in this tax bracket, and it is my understanding that any additional income for Floyd (Pacquiao fight) would not push him into the next tax bracket... because another tax bracket does not exist.



What I found on "millionaire tax bracket":

What the discussion over the top marginal tax rate ignores, however (and what Ygelsias picks up upon) is that this rate has been assessed at very different thresholds of income. In 1940, for example, the top marginal tax rate was 81.1 percent -- but this rate only kicked in once you made $5,000,000 or more in income, which is equivalent to about $75,000,000 in today's dollars.

But today, the threshold where the top tax bracket kicks in isn't $75 million, or $5 million, or even $1 million ... it's a mere $357,700(as of 2009, it was kicked up to $373,651 for 2010).

The progressivity of the tax code stops there.

http://www.fivethirtyeight.com/2009/03/missing-1000000-tax-bracket.html

Your thoughts?

When it is all said and done its around 51%, That is why all these sport figures have foundations and give huge donation so it can write some of it off. Instead of the tax man getting it they have their favorite charity benefit from it. It does have a ceiling, also they would deffer to pension plans that are tax exempt but it has a low limit how much they can contribute.

It doesn't matter if he fights this year or the next he is going to get taxed the same

[THE REED]

When it is all said and done its around 51%, That is why all these sport figures have foundations and give huge donation so it can write some of it off. Instead of the tax man getting it they have their favorite charity benefit from it. It does have a ceiling, also they would deffer to pension plans that are tax exempt but it has a low limit how much they can contribute.

It doesn't matter if he fights this year or the next he is going to get taxed the same

Pretty much....

[oc9979]

No that isn't true there is corporate tax brackets as well which I've already discussed.

An S corporation does not pay taxes. They do 1120s and this is for information only.

[RlCKY]

He will fight this year if he is smart because the tax rate is raising from 35% to 39% next year...Which would be 2 million more in his pocket (if he makes 50mil in pac fight)

[THE REED]

An S corporation does not pay taxes. They do 1120s and this is for information only.

Yes that is correct, in the event Mayweather Promotions was actually established as an S corp, then the income would just pass through to the shareholder... which would be Floyd Mayweather..

In this case, he would then pay personal taxes, instead of the company... and still end up in the top personal income bracket, whether he fought Pac this year... or next.

[badass316]

I have seen people around here saying that if Floyd fights Pac in 2010... that his earnings for the fight... in addition to his earnings for the Mosley fight would push him into the next tax bracket.

This would make Floyd want to wait until 2011, so that the Pac fight earnings do not push him into the next bracket, and he would pay a higher percentage.

I myself am someone who has been saying this...


After doing some research (because I am not a tax expert).


There is actually a ceiling on the federal tax brackets..

In other words... once you make a certain amount per year... your tax percentage does not increase... should you continue to make more.

Depending on what you make, you fall into a certain criteria.. such as follows:

10% - $0 – $8,375

15% - $8,376 – $34,000

25% - $34,001 – $82,400

28% - $82,401 – $171,850

33% - $171,851 – $373,650

35% - $373,651+


35% seems to be the federal ceiling tax bracket.

In addition, Nevada (where Floyd lives) Does not have State income Tax.

With the Shane Mosley fight, obviously Floyd is already in this tax bracket, and it is my understanding that any additional income for Floyd (Pacquiao fight) would not push him into the next tax bracket... because another tax bracket does not exist.



What I found on "millionaire tax bracket":

What the discussion over the top marginal tax rate ignores, however (and what Ygelsias picks up upon) is that this rate has been assessed at very different thresholds of income. In 1940, for example, the top marginal tax rate was 81.1 percent -- but this rate only kicked in once you made $5,000,000 or more in income, which is equivalent to about $75,000,000 in today's dollars.

But today, the threshold where the top tax bracket kicks in isn't $75 million, or $5 million, or even $1 million ... it's a mere $357,700(as of 2009, it was kicked up to $373,651 for 2010).

The progressivity of the tax code stops there.

http://www.fivethirtyeight.com/2009/03/missing-1000000-tax-bracket.html

Your thoughts?

Quite informative, nice job on the research.

Unless there are other things behind the curtain that we aren't made aware of, this should pretty much pull the plug on the tax excuse for not wanting to fight in November.

[THE REED]

Discuss the tax issues here, the thread already exists.

[Horus]

I saw this argument the other day It Goes Like This

http://www.themoneyalert.com/Tax-Tables.html

Single
Over: $373,650+
Tax: $108,421.25 + 35% (total income)

Floyd Mayweather
Income: $65,000,000
Tax: - $108,421,25 + 35% (22,750,000)
Total: $22,858,421.25

Now Add Another 40-60 Million Dollars to that sum and you can figure out
why some people think this is a valid reason for argument on the tax issue.

[THE REED]

I saw this argument the other day It Goes Like This

http://www.themoneyalert.com/Tax-Tables.html

Single
Over: $373,650+
Tax: $108,421.25 + 35% (total income)

Floyd Mayweather
Income: $65,000,000
Tax: - $108,421,25 + 35% (22,750,000)
Total: $22,858,421.25

Now Add Another 40-60 Million Dollars to that sum and you can figure out
why some people think this is a valid reason for argument on the tax issue.

No.... you can't.



If he makes more, he pays the SAME percentage.


It doesn't matter if he makes 100 million this year, or 50 million this year and 50 million next year.

It's all the same.



Actually, he will pay more for earnings in 2011 because of the bush tax cuts that expire at the end of 2010.