The Atlanta Braves Have A Tax Problem
Did you know about this stupid law? I didn't. From Bloomberg:
The Atlanta Braves, the country’s only publicly traded Major League Baseball team, is facing off against the US tax code in a lonely battle that threatens to cost the franchise millions.
A little-known tax rule soon to go into effect will restrict public corporations from deducting the salaries paid to their highest compensated employees. For Atlanta Braves Holdings Inc., those employees are players — including first baseman Matt Olson, third baseman Austin Riley and former National League Most Valuable Player Ronald Acuña Jr.
The team’s five most generously compensated players are set to collectively earn $96 million in 2027 — the year the new rule limiting salary deduction for all but $1 million of each of the top five most highly compensated players’ pay. That amounts to a potential $19.1 million tax hike on the Braves, assuming a 21% corporate tax rate. The team paid $4.2 million in federal income taxes in 2024, according to a regulatory filing.
Privately held teams like the New York Mets, owned by Point72 Asset Management founder Steve Cohen, and billionaire John Middleton’s Philadelphia Phillies, won’t get hit by the tax.
. . . one other professional sports entity affected by the 2027 tax hike: Madison Square Garden Sports Corp., which owns the the National Basketball Association’s New York Knicks and the National Hockey League’s New York Rangers.
