Deferred compensation is a win-win scenario for players & owners alike. The MLS and its owners will also benefit from long-term tax savings, as they will be able to recognize higher salary expenses (offsetting expected revenue growth) in the future as the players' deferred compensation compounds.
In this example, when contracted player opts to defer an average of
71%
of their
$850,000
average annual salary
10
years into retirement, MLS Ownership will be able to deduct
$6,883,398
in total, compared to a
$3,400,000
salary deduction if deferred compensation was unavailable - increasing the net tax benefit by
2.02x.
Archford Capital Strategies, LLC (“Archford”) is a Registered Investment Advisor, registered with the U.S. Securities and Exchange Commission (“SEC”). Registration as an investment advisor does not imply a certain level of skill or training. The information presented has been prepared on the basis of publicly available information, internally developed data or other third-party sources. There is no guarantee as to the accuracy, completeness, or reasonableness of the contents contained herein and does not constitute an official account statement. Archford Capital Strategies, LLC and its affiliates do not provide legal advice. Tax and accounting services are offered through Archford Accounting, LLC, an affiliated entity of Archford Capital Strategies. Archford Accounting, LLC must be formally engaged for tax or accounting advice.
This application performs a compounded interest calculation based on the inputs that the user enters for salary, deferral period, investment style, and deferral payout length. Final values factors in the previously listed inputs, as well as current year tax rates and the user's marital status. Results on this application will vary only if an input is adjusted, as there is no variability or simulation in the calculation itself.
The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor's particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor.
Investing involves risk, including the possible loss of principal and returns. There are no guarantees that investment objectives will be met. Returns presented in this document contains hypothetical performance data, which have inherent limitations. Actual future results may not align with the hypothetical results presented herein. Actual account performance may be higher or lower. No representation is being made that any account will achieve profits or losses similar to those shown. There may be material differences between hypothetical performance results and the actual results subsequently achieved.
