ESPN loves it some Jeremy Lin. Ever since that February night when Lin — the former undrafted Harvard point guard who was unceremoniously dumped by several NBA teams before emerging as a midseason starter for the NY Knicks – cemented his place as the best story in sports by hanging 38 on Kobe and the Lakers in only his fifth career start and giving rise to an endless string of lazy titles like the one used above, the worldwide leader has had Lin squarely in the crosshairs of its unique brand of suffocating coverage. Stated another way, if Jeremy Lin and Tim Tebow ever released a sex tape together, ESPN would collapse on itself like a dying star.
So when the clock struck midnight this Tuesday without the Knicks matching the 3-year, $25.1 million offer sheet Lin signed with the Houston Rockets, ESPN’s endless string of bombastic talking heads were left to ponder: How could this happen? Further muddling this quesiton were reports indicating that the Knicks had previously agreed to match an informal, four-year offer from the Rockets before Lin called Houston back to the negotiating table to restructure the deal. The reworked offer sheet pulled more money into year three, a poison pill that would prevent the Knicks from matching without severe financial consequences. If true, this would certainly seem to indicate that Lin wanted to leave NY. But why?
Why would a guy with 26 career starts leave the one team that had given hm a chance? Particularly to go to Houston, one of the teams that previously had Lin in their coffers, only to deem him not good enough? Why would anyone forsake the bright lights of the Madison Square Garden stage to ply their trade in Texas, of all places?
How about for an extra $3,000,000?
With the move from New York to Texas, Jeremy Lin says goodbye to the oppressive New York State and city income tax regime; one that would have taken 8.8% and 3.8%, respectively, off the top of his shiny new $25,000,000 contract. Texas, of course, has no income tax, meaning Lin just pocketed himself a cool $3.1 million over the life of his deal.
Lin’s shortcomings are no secret — turnover prone, can’t go left, and a turnstile for a defender — but the guy did go to Harvard. Maybe he just did the math.
You are not taking into consideration that games played outside of Texas and Florida are taxable. This would make his savings only about 60-70% of $3 million you claim. It is still a nice chunk of change though.
Sean, I agree completely that his annual salary would be apportioned among the states in which he plays, leaving Lin with some level of state tax liability even after he lands in Houstaon. I was just trying to illustrate that he left a state with an effective rate of nearly 11% for one with no income tax.
In defense of the article, half of the playoff games would conceivably be in Texas. Plus any endorsements/royalties would also be Texas income.
Sam – your conclusion assumes he would move his domicle/residency to Texas, which from a tax standpoint is a no-brianer , but isn’t necessarily a “given”. Also with regard to allocation of his income from games, etc.; the allocation to TX would likely be higher since practice would count as duty days and likely would occur more often then not inTX.