Because the Houston Astros are hated They cheated. Cheaters don't cheat. However, outside of Los Angeles, they are hated a little more every day.
The money supply seems endless. So is the All-Stars lineup. But deferred contracts can make the haters very angry.
The defending World Series champions bolstered their roster with a series of “play now, pay later” contracts, all of which gave the Dodgers a small break on their luxury taxes, according to the collective bargaining agreement. So, the haters ask, can someone please stop the Dodgers?
Josh Becker likes. He is a California senator, a Democrat from Menlo Park. The Dodgers have to More than $1 billion was deferred on salary for the last five years. Each dollar of deferred salary can be a dollar that is not taxable to the state.
“The Dodgers are taking advantage of that hole,” Becker told me. “It was never intended for anything remotely like this.”
Here's the loophole: Under federal law, if you earn your salary in one state and retire in another, You don't need to pay income tax In salary that you defer for retirement.
California is at risk of losing up to $138 million in revenue because of the Dodgers' deferrals — $90 million in Ohtani's contract alone, if he returns to Japan or moves to another state after his contract expires.
“He exploits people whose pensions are $20,000 or $25,000. “That's the way it should be.
“We set up a system. Other people follow it. You're basically cheating other people's taxes. It's basic fairness.”
In December 2023, the Dodgers signed Ohtani to a 10-year, $700 million contract. $680 million deferred Beyond the life of the contract. Four weeks later, state Comptroller Malia Cohen said the deal explained the need for Congress to limit how much money can be deferred subject to taxes.
“This move will not only create a more equitable tax system,” Cohen said In a statement“But generate additional revenue to address critical social issues and foster economic stability.”
Last March, Becker introduced A bill It urged Congress to “establish a reasonable limit on deferred compensation.” The first line of the bill: “However, in December 2023, the Los Angeles Dodgers baseball team signed pitcher and hitter Shohei Ohtani to a 10-year, $700,000,000 contract.”
Bill allowed the state senate but died in the assembly; Becker withdrew the bill when he realized it would not pass.
California's income tax rate for top earners is 13.3% Highest in the country. It makes financial sense for players and others to retire to states like Florida and Texas that have no state income tax.
Becker said he heard about his bill: Wealthy executives, not just bowlers, would benefit from such deferred compensation.
“They shouldn't be using it either,” he said. “Let's close the loophole.”
It's not just about Ohtani or the Dodgers, Becker said. It focuses on Ohtani and the Dodgers trying to reform the tax code.
Becker said he may reintroduce his bill. His timing could be better. The bill basically asks Congress to make certain people pay more taxes. It's more likely that the Colorado Rockies will win the World Series this year — than Congress will pass — and that President Trump will sign such a bill.
“If anything, they're more focused on cutting corporate taxes than on people paying their fair share,” Becker said.
Becker represents a district in San Francisco Giants territory, but grew up in Philadelphia and is a Phillies fan. He doesn't really blame the Dodgers. He blames the Congress. Shhh, but he kind of adores the Dodgers.
“The Dodgers,” he said, “are building a little dynasty over there.”
