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Sports See other Sports Articles Title: Pittsburgh Steelers, Taxes (Obama) And Selling Sports Teams The Wall Street Journal is reporting this morning that the Pittsburgh Steelers might soon be for sale. The word is that the team’s chairman Dan Rooney and his son Art II are trying to buy Dan’s four brothers out. I’m thinking the Steelers are going to stay in the Rooney family, but there are a couple good reasons why I think it’s a good time to sell and I’ll some it up in one sentence: EVERYTHING IS BIGGER IN TAXES. In the next three years, I believe that more high profile sports teams will be sold than ever before. Why? Because of the estate tax repeal in 2010 and even sooner than that, the potential of a huge increase in capital gains taxes if Barack Obama becomes our next president. Let’s focus on the latter first. A capital gains tax is a tax on the profit from a sale of something. Currently, if an owner sells a team, he’ll have to give 15 percent of the profit back to the government in capital gains. But under Obama’s current plans, that number could rise to as much as 28 percent, meaning that the money paid to the government after the sale of the team might double by next year. Let’s say the Rooneys could get $1.3 billion for the Steelers. Factoring in everything they pumped into the team, let’s say their profit is $600 million. Selling it now vs. if Obama is in office could mean the difference of nearly $80 million. The second tax aspect that affects sales is the estate tax, which is the government’s charge for passing down businesses to family members. In 2010, for just that year, the estate tax is repealed, so many of the wealthy--including sports team owners--are hoping to make it to Jan. 1, 2010 and die before Jan. 1, 2011, so that their team can be passed down through the family without a charge. Many think the estate tax in some form will still exist in 2010, but the prospect that that it will exist at a discount is a possibility. If that’s the case, I think teams will change hands within the family and the prospect of those members selling is greater than if it were still in the hands of the patriarch. Finally, I think the Steelers sale would be a great prize for one of the 11 bidders that loses in the Chicago Cubs sweepstakes. One of those owners just wants to own a premium franchise and if they were going to spend $1 billion the Cubs, they’re probably well enough financed to cover a Steelers purchase. One guy who won’t be buying the Steelers if he doesn’t win the Cubs bid is Dallas Mavericks owner Mark Cuban, who is a Pittsburgh native. Cuban told me this morning that he didn’t think small markets could excel in the current cap based system the NFL has.
Poster Comment: I'm sure that Obama supporters would claim that death taxes are for "the greater good", that only the very very very very very rich are affected...righhhhhttttt ...and Obamaphiles would also say that leaving a legacy to beloved family members is selfish, because love for "the state" should transcend love for one's family...march on dear comrades!
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#1. To: scrapper2 (#0)
(Edited)
It's a nice gesture, but I doubt if many old coots would want to die before 1/1/2011 just so their heirs could save on taxes.
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