New York Mets shortstop Francisco Lindor has reportedly agreed to a 10-year, $341 million contract extension. The deal will start in 2022 for Lindor, whom the Mets acquired in the offseason from the Cleveland Indians.
The amount the 27-year-old, four-time All-Star pays in taxes will hinge on where he resides.
Regardless of where Lindor lives, he’ll pay the highest federal income tax rate (currently 37%) on the portion of his income that exceeds a certain threshold (currently $518,401 or, if married filing jointly, income that exceeds $622,051.) This means—assuming the highest income tax rate holds steady at 37% over the next decade—he’ll pay $127.1 million to the federal treasury.
Likewise regardless of where Lindor resides, he’ll pay what we estimate to be $11.9 million in so-called “jock taxes”—state and/or city taxes on visiting teams’ players for games played in their jurisdictions. Lindor’s residency choice also does not impact his obligations to federal payroll taxes used to fund Medicare and Social Security, which we estimate will add up to $8 million.
Lindor’s tax calculus changes when comparing his taxes based on residence. If Lindor resides in the state of New York, he’ll pay $24.1 million in state income taxes; if he chooses to live in New York City, which has its own income tax, he’ll owe a combined $37.3 million to the state and city. Please note: We have assumed that Lindor will receive a partial credit in New York state for the jock tax he pays if he’s a New York State resident (if he was a non-resident he would not receive the partial credit).
Yet Lindor has ties to other states. He moved from Puerto Rico to Florida as a child and played high school baseball in the Orlando area where he recently purchased a $3.5 million estate. Florida is one of nine states without an income tax. If Lindor resided there or in another no-income tax state, he would pay $16.5 million to the state of New York—meaning he would pay $20.8 million less in taxes than if he resided in New York City.
Tax implications are of course not the only factor to consider in where one resides. Lindor would also need to meet the relevant residency requirements of the state where he chooses to reside. But as is always the case, what one pays in taxes can be greatly impacted by residency.
Lindor’s debut with the Mets remains in limbo after the team’s Thursday night season opener against the Washington Nationals was postponed due to a positive test with the D.C. team. The next scheduled game between the two is Saturday at 4:05 p.m. ET.