Monday, January 21, 2013

Multimillionaire Professional Golfer Wants to Take His (Golf) Ball And Go Home Cause Of Mean Old Taxes

I don't generally pay attention to professional golf (or unprofessional golf either), but this story caught my eye. Seems some guy named Phil Mickenson, is a little bit unhappy at all the new taxes he might have to pay thanks to Obama and California:

"There are going to be some drastic changes for me because I happen to be in that zone that has been targeted both federally and by the state and it doesn't work for me right now," Mickelson said.

While Mickelson didn't state specifics, increases in federal taxes under the deal to avoid the fiscal cliff in Washington D.C. and the passage of Prop. 30 in California in November to raise money for school funding have all increased taxes on the wealthy class.

"If you add up all the federal and you look at the disability and the unemployment and the Social Security and the state, my tax rate's 62, 63 percent. So I've got to make some decisions on what I'm going to do."

So what might those possible decisions be?

The 42-year-old golfer said he would talk in more detail about his plans – possibly moving away from California or even retiring from golf – before his hometown Farmers Insurance Open, the San Diego-area event that starts Thursday at Torrey Pines.

Whoa. Sounds kind of drastic to quit your career entirely, but I guess if the government is confiscating that much of your hard earned money, then there's probably really little incentive to continue, right?

Well, I was curious to see how much money the poor guy would be left with after Obama's IRS Gestapos were through raiding his wallet. It seems in 2011, he was merely the second highest paid athlete, with a pitiful $62 million (both salary and endorsements).

So let's do some quick calculations. If we take that number and tax it at the rate Mickelson claims, 63% (it almost certainly wouldn't actually be that high since we have progressive taxation, and things like Social security taxes only apply to the first $108k, but I digress), his after tax income comes in at an utterly depressing $23 million. Who the hell can live on such a meager amount, I ask?! You might as well make nothing!

I should also highlight this particular exchange that Mickelson had with a reporter from USA Today:

Q. How do you balance that against the TOUR’s retirement plan which by all standards is the best retirement plan in sports?

PHIL MICKELSON: I don’t understand. What do you mean?

Q. Well, I mean I understand the 60 percent part of the equation, but in the TOUR’s plan, you guys put about as much money aside as you want. It’s treated differently under tax laws than most anybody else’s tax plans. Where most people can only put away $45,000 or $50,000, you guys can put as much away as you want. And so at the end you guys end up with a much larger pot of gold than most people can.

PHIL MICKELSON: But when it comes out, it’s still taxed at the same 62 percent rate.

Q. Well, you’re still making that kind of money. That’s if you’re still in that bracket.

PHIL MICKELSON: (No response.)
 Indeed.

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