That's about 83 bucks per point. Is that worth it to a Nike Shareholder? I'd probably say yes.
That's about 83 bucks per point. Is that worth it to a Nike Shareholder? I'd probably say yes.
I wonder if there is a cap on how many times he can do this....does he get another 750k for breaking the WR again in London...or wherever.
And one assumes there was a bonus for winning the Olympic Trials / Making the Games. And one assumes there were other incentives and bonuses woven into his contract.
Phil Knight is extremely pleased I am sure to have a former Duck hold this most vaunted of records, and to have it set at Hayward...adding to the legend.
How much after taxes?
Probably about $450K-$500K after taxes. I'll gladly take that!
lol, Brienne Thiesen going to get dumped!
If Eaton had made himself into an LLC, like Nick Symmonds, he'd be sitting pretty on taxes.
you can only earn one bonus per year and only one. so if he got a bonus for the long jump of 20k and hurdles 20k. but then 750k for the entire world record then he JUST gets the 750k thats usually how most all nike contracts works. none of the other count and you can't add them together.
wallfly wrote:
If Eaton had made himself into an LLC, like Nick Symmonds, he'd be sitting pretty on taxes.
There has to be a reason that all sponsored athletes aren't doing this then, right? It would seem like a no brainer if they really can pay less in taxes.
Is that a so-called "Bubka" clause? Sergey Bubka was known for raising the pole vault record a 1/4" at a time to maximize his bonuses. Also, what about an indoor heptathlon record? Would he be able to set a record there in a year where he also set an outdoor record in the decathlon and get a bonus for both (assuming the contract covers the indoor decathlon)?
wallfly wrote:
If Eaton had made himself into an LLC, like Nick Symmonds, he'd be sitting pretty on taxes.
Can you explain that more fully? How could an LLC pay any less tax than an individual taxpayer?
He deserves every penny !
NBA minimum $480k rookie
MLB minimum $480k rookie
NFL minimum $430k rookie
World record. Decathlon a bonus of 750k
Tghpdx wrote:
NBA minimum $480k rookie
MLB minimum $480k rookie
NFL minimum $430k rookie
World record. Decathlon a bonus of 750k
Going to the Olympics...priceless.
Concerned Citizen wrote:
wallfly wrote:If Eaton had made himself into an LLC, like Nick Symmonds, he'd be sitting pretty on taxes.
Can you explain that more fully? How could an LLC pay any less tax than an individual taxpayer?
My understanding is then you can deduct travel, meals, and things like that. But i'm not even sure if he's paying for that as it is? Also in general corporations will pay less tax than someone making the highest tax break, so you pay a bit less. There's probably a bunch more reasons, but I know other people who do something similar (not for sports) for the same reason to save money on taxes.
It depends:
The IRS does not recognize an LLC as a classification for federal tax purposes. An LLC business entity must file a corporation, partnership or sole proprietorship tax return.
An LLC that is not automatically classified as a corporation can file Form 8832 to elect their business entity classification. A business entity with a single member can choose to be classified as either an association taxable as a corporation or disregarded as an entity separate from its owner, a “disregarded entity.”
After you have filed the 8832, if you want your LLC taxed as S corp, you file a 2553.
If you chose to have the LLC taxed as an S corp, the tax advantages of LLC take on those of an S corp.
LLC tax advantages extend to the ability, under the S corp, to pay yourself a “reasonable wage” and then take the rest of the “profit” as a distribution. The LLC self employment tax applies to the portion taken as a wage, but the distribution is not subject to the LLC self employment tax. You’ll save about 5-7% in tax on the amounts you take as the distribution.
Overall, LLC taxes are simply the tax structure you chose. If you do nothing when you set up your LLC, you’ll be taxed as a sole proprietorship, if you are the sole owner.
Example:
Nick is a sole proprietor bringing in sales of $90,000. After he pays his costs and expenses, his profit is $60,000. As a sole proprietor, he is required to pay self- employment tax of 15.3% on this entire $60K of profit, which equates to $9,180.
Now, let’s assume Nick chose for the LLC to be taxed as S corp, and chooses to pay himself $35K for the year in salary, and take the remaining $25K of profit through a distribution. He still earns the same $60K in profit. But, because corporations only pay Social Security & Medicare taxes on salaries, he’s only liable for $5,355, saving over $3,800 in taxes.
With all that said, a single member LLC (unless the USATF failed to promulgate that rule too!), cannot enter into a track competition, and therefore would not be in a position to enter into the sponsorship contract with Nike that resulted in the bonus. But it sounded good while I was writing.
Yep.
GoldenMVP wrote:
He deserves every penny !
Does his agent get 10% of that? I'm assuming he does.
Adam Eaton wrote:
Tghpdx wrote:NBA minimum $480k rookie
MLB minimum $480k rookie
NFL minimum $430k rookie
World record. Decathlon a bonus of 750k
Going to the Olympics...priceless.
Lol, best thing I've read on these forums
Good for him.