RussellEbertHandball
Flick pass expert
They are paying him $2m a year for 10 years starting in 2024 and then $68m a year for 10 years after that. Its a tax deferred/avoidance driven deal.
If he gets $70m a year, his Californian income tax bill will be about $10m a year, but if he moves to a state like Nevada (Edit or back to Japan) that has no income tax, then he avoids state income tax whilst receiving $68m a year in retirement.
If he took all the $$$ during his 10 year playing career, it would have probably been a $40-$50m a year deal, given Yankees Aaron Juddge signed a straight 9 year deal for $360m starting in 2023.
This article from September 2024 when Ohtani was nearing the end of the regular season before the play offs started, and he had just achieved the first time ever effort by a player of 50 home runs and 50 stolen bases in a seasons, explains the deal and the tax implications.
Inside Shohei Ohtani’s Unusual Contract
Baseball's first 50-50 player, Shohei Ohtani, may have left $50M on the table. Two Poole experts analyze his contract.
We will never see a salary deferral like this Ohanti deal ( or the $765m 15 year deal signed by Juan Soto who left the Yankees at the end of last season for the Mets and is only 26) in the AFL - they wont ever scrap the salary cap, but clubs will look to US sports for tricky ways to structure deals and push things out expecting the salary cap to continually increase. Plus clubs will push the AFL for more salary cap exemptions and to loosen up ASA requirements.
This ESPN reporter tweeted yesterday that LA have already brought in $700m of revenue in the first 2 years of Ohtani's 20 year contract. If so, lets see how much LA are banking away in a not to be touched investment account to fund the $680m payment between years 11 and 20 of Ohtani's contract. He has already brought LA one World Series title and its looking like it soon will be 2. If he can make it 4 or 5 over 10 years then he will have more than paid for his contract.
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