Here are excerpts from a couple of related posts about LeBron James. Let me begin by stating that I don't care where LeBron James chooses to throw plastic bags of air through metal rings. I'm a football guy.
The first (from back in October 2008) is from BET.com, in which rapper Jay-Z and LeBron James offer the following words of encouragement:
If you plan on voting for Barack Obama, Jay-Z would prefer that you do it sooner than later. He and NBA superstar LeBron James are calling on people to cast their ballots ahead of time – and vote for Obama. James and Jay-Z hosted a concert and rally Wednesday at the Quicken Loans Arena in Cleveland . James attended a Cleveland rally earlier this month to encourage people to vote for Obama. He’s also contributed $20,000 to a committee supporting the Democratic presidential nominee.
Next, we have this gem from the Wall Street Journal. I'm quoting from the version quoted at The Tax Prof, since I don't subscribe to the WSJ's online edition:
We come not to praise or bury LeBron James, but only to note that by moving to Miami he's going to save a bundle on taxes. ... Florida has no income tax. The rate in Akron, Ohio is a little over 7%.
Mr. James figures to earn close to $100 million in salary over five seasons in Miami. According to an analysis by Richard Vedder, an economist at Ohio University, Mr. James's net present value tax savings on his salary are between $6 million and $8 million by living in Miami versus his home town of Akron. Professional athletes do have to pay other state taxes for the dates they play in visiting team arenas, but most of Mr. James's considerable endorsement income would be taxed at Florida rates.
The tax comparisons looked even worse for two other teams in the LeBron bidding, the New York Knicks and New Jersey Nets. ...
The New York State tax rate is 12%. If James was serious about supporting the Teleprompter Jesus and all his holy works, wouldn't New York have been the best place to go? The idea behind Obama's candidacy was for the wealthy to start paying as much as possible as soon as possible, right?
While LeBron's departure got extraordinary media attention, it is hardly unique. In the early 1990s, Ohio was the home of 43 Fortune 500 companies. Twenty years later the number is 24. Census Bureau data show that from 2004-2008 Ohio saw a net outmigration of $6 billion of income and some 97,000 taxpayers. Even Ohio's famously liberal Senator, the late Howard Metzenbaum, moved to Florida late in his life to reduce his estate taxes.
We feel for Cleveland fans, but maybe they should allocate some of their wrath to the state politicians who keep driving high-income individuals and their businesses to financially sunnier climes.
$8,000,000 is merely the amount that Mr. James is trying to save on state taxes. That's on his basic salary, not endorsement deals. Does anyone care to guess how many tax accountants LeBron James is now currently employing to protect his earnings from Barack Obama's Treasury goons? (Hint: I bet that the answer is "lots".)
The LeBron James Nike ad came from here.