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Diaz up as 27th man for today's game


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11 hours ago, Jagwar said:

In what world does he net $10 mm after taxes? Especially if he was an employee of a California based team?

I don't know, I'm not that familiar with the $1M+ a year tax brackets.  Feel free to change the math to whatever you think is appropriate.  If he got to keep half instead of 2/3rds, then he has to make due with $175k a year.

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11 hours ago, OsFanSinceThe80s said:

There’s plenty of athletes who have burned through $100M+ and end up having to downsize their lifestyle in retirement. Not saying Diaz has gone through all his money, but between taxes and his agent at best he’s been able to keep 2/3rd’s of his money as a starting point. 

Hopefully Diaz has a decent financial advisor/accountant. 

And that would be being stupid.  I addressed that.

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“If, during the taxable year that * * * received the bonus from * * *, he performed no services in the U.S., it is our view that the bonus is not subject to U.S. tax, as provided in section 872(a). However, if during the taxable year that he received the bonus, services were performed both within and outside the U.S., the bonus must be allocated to both U.S. and non-U.S. sources as required by section 863(b).”

https://www.taxnotes.com/research/federal/irs-private-rulings/legal-memorandums/bonuses-and-salaries-paid-to-foreign-ball-players-not-u.s/1fgsg

Diaz was signed in late 2015, and played no games.   So I think he probably was still a foreign resident and paid no US taxes on his bonus.

 

Edited by Frobby
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23 hours ago, DrungoHazewood said:

Should be.  Let's say he keeps $10M after taxes.  Spends or gives away $5M, remittances back home.  Puts the other $5M in some kind of relatively conservative investment making 5% a year.  That means with a bit of self restraint he could live on $250k a year indefinitely.  That's not too bad.

4% is widely regarded as the Safe Withdrawal Rate for a 30 year retirement. For 60 years you probably want to withdraw about 3%. That would still for allow close to $200k spending.

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10 minutes ago, Aristotelian said:

4% is widely regarded as the Safe Withdrawal Rate for a 30 year retirement. For 60 years you probably want to withdraw about 3%. That would still for allow close to $200k spending.

Right, and that $200k is going to be taxed since you're living on the interest/investment gains you realize and pull out.  So it's like a $200k salary that you still have to pay taxes and health insurance and the like from.  So it's a very good foundation, but not some kind of lavish lifestyle with mansions and butlers and Ferraris.  But you could pick and choose a job based on whatever you want to do without financial considerations.  

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6 minutes ago, DrungoHazewood said:

Right, and that $200k is going to be taxed since you're living on the interest/investment gains you realize and pull out.  So it's like a $200k salary that you still have to pay taxes and health insurance and the like from.  So it's a very good foundation, but not some kind of lavish lifestyle with mansions and butlers and Ferraris.  But you could pick and choose a job based on whatever you want to do without financial considerations.  

And if you decide you don't want to retire in the US and instead want to retire to some place in the Spanish speaking world the cost of living will probably be much lower.

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14 minutes ago, Can_of_corn said:

And if you decide you don't want to retire in the US and instead want to retire to some place in the Spanish speaking world the cost of living will probably be much lower.

Here I am thinking about brushing up on my German so that in 10 years I can retire and spend summers in the Alps where the cost of living is all the money.

Edited by DrungoHazewood
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