Juan Soto could take advantage of an interesting tax loophole in his monster contract with the Mets.
Soto and the Mets agreed to a 15-year deal worth $765 million in a blockbuster deal that shook the sports world.
This was reported by the newspaper's reporter John Heyman. Soto received a $75 million signing bonus, but the slugger is not subject to hefty New York state income taxes because he is a resident of Florida, which does not tax personal income.
So, after deducting federal income tax at the top rate of 37%, Soto would forfeit $37.75 million in taxes and take home $47.25 million of his contract money.
If Soto had received this income in New York, he would have had to forgo nearly $8 million more in taxes.
New York state income tax rate for income over $25 million 10.9%And nearly all of Soto's signing bonus would have been subject to these taxes if he lived in New York.
Soto will receive a total compensation of about $120 million in 2025, Heyman said.
After deducting his signing bonus, he is left with $45 million in salary to play next season.
Because athletes are taxed locally for road games, about half of that amount doesn't count as New York state income, but it still approaches the top marginal tax rate of $25 million.
Soto will get just under $47.25 million after waiving agent Scott Boras' customary 3-4 percent commission, but he shouldn't have much trouble picking up the check at dinner.
