Taxes and salaries

[Hobo Gonzolez]

So here is my question.
Bosh can sign with Toronto for more money then any other team due to Bird rights. However If he signs in Miami where there is no tax, is it possible he can technically get payed more by Miami despite having a lower cap hit? I have read a few times that he could do that but to me if this is possible isn't it against the point of the cap system because one team can pay someone more and have a lower cap hit.

[loserX]

So here is my question.
Bosh can sign with Toronto for more money then any other team due to Bird rights. However If he signs in Miami where there is no tax, is it possible he can technically get payed more by Miami despite having a lower cap hit? I have read a few times that he could do that but to me if this is possible isn't it against the point of the cap system because one team can pay someone more and have a lower cap hit.

Well, Bosh's take-home pay would be greater in Florida, but the cap hit would be the same. The NBA is not going to run around setting different salary caps and contract maximums for each individual team based on their home state/country's tax laws at the time. That's not feasible even if all 30 teams did agree to it, which they never would.

[Hobo Gonzolez]

So here is my question.
Bosh can sign with Toronto for more money then any other team due to Bird rights. However If he signs in Miami where there is no tax, is it possible he can technically get payed more by Miami despite having a lower cap hit? I have read a few times that he could do that but to me if this is possible isn't it against the point of the cap system because one team can pay someone more and have a lower cap hit.

Well, Bosh's take-home pay would be greater in Florida, but the cap hit would be the same. The NBA is not going to run around setting different salary caps and contract maximums for each individual team based on their home state/country's tax laws at the time. That's not feasible even if all 30 teams did agree to it, which they never would.

So, in a practical sense, Miami has a larger maximum contract in terms of how much money actually goes to bosh, then say New York.
I dunno I kinda find this against the point of a maximum contract.

[semifiction]

Question 63 from the Salary Cap FAQ

"63. Are teams really competing on a level playing field? Since the tax rate is different in the different states and Canada, don't the teams in a more "tax friendly" state have an advantage over the other teams?

Yes they do. For example, since Florida has no state income tax, an offer from Orlando will offer a higher net income than the same offer from Los Angeles. However, the league added a regulation to help neutralize the tax disadvantage of Canadian teams. All teams are permitted to offer a signing bonus of up to 20% (see question number 62). For U.S. residents in Canada, this bonus is taxed at just 15%. Using this bonus, Canadian teams can nearly achieve tax neutrality."

So there apparently is some parity...

[Mezotarkus]

There is no parity dealing with differences in state and local income taxation. For example, Knicks players must pay New York and New York City taxes which can be significantly higher than the state and local taxes imposed by players on other teams.

Importantly, all players pay state income tax because they are taxed on their play in other locations for away games. The difference resides with the home games since the Knicks will play all their home games in MSG while the Orlando players will play theirs in Florida. For example, 50% of the Knicks income will be taxed at NY/NYC rates.

However, I suspect you are going to see something interesting in the 2010 offseason. I believe Lebron, Wade and Bosh may sacrifice some salary to ensure they are best positioned to win a championship.