The Los Angeles Dodgers have so much talent that they don’t really know what to do with it all. Still, Los Angeles is as active as anybody as it pursues improvements for its roster.
Recently, the Dodgers announced the signing of international free agent Hye-Seong Kim. Kim is a versatile infielder who can play anywhere across the infield at a high level.
This signing might not put the nail in the coffin for Gavin Lux’s time in Los Angeles, but it certainly makes the 27-year-old infielder expendable.
Lux slashed .251/.320/.383 with 10 home runs and 24 doubles in 2024. He’s under team control through the 2026 season. The perfect trade match is sitting right in front of the Dodgers’ eyes, but it might not be who Dodgers fans want it to be.
To preface, the Dodgers don’t need to trade Lux. It just seems like his days are numbered given the state of the roster. And if a team like the New York Yankees is desperate enough to overpay for him, Los Angeles would be foolish to not listen to the offers. The Yankees are desperate for an affordable infielder with experience and a solid bat.
That’s exactly what Lux would give the Bronx Bombers. The Dodgers may not want to send such a valuable infielder over to the same team they played in the World Series last year, but the Yankees would likely issue a very intriguing offer.
NHL Team Copies Dodgers’ Salary Deferral Plan With Unique $18 Million Contract Extension
The success of the Los Angeles Dodgers on the field is hard to dispute. No MLB team has won as many games during the regular season since 2012. In October, they won their second World Series in the previous five seasons and their ninth overall.
The Dodgers have a practice of signing players to deferred-money contracts behind the scenes. The most well-known example comes from Shohei Ohtani.
In December 2023, the two-way star and current National League MVP agreed to a seven hundred million dollar, ten-year contract with Los Angeles. Additional news: The Dodgers will sign a three-year contract with an Asian star. Ohtani will not get more than 97 percent of his compensation, or $680 million, until after the 2033 season, which will mark the end of his ten years in Los Angeles.
For the Dodgers, this means that the current value of Ohtani’s contract is lowered to about $461 million based on Major League Baseball’s computation because so much of his salary has been postponed.
The Dodgers’ competitive balance tax obligation is based on that figure. It guarantees Ohtani’s yearly salary for the next 20 years, long after his playing days are over.
Additionally, it allows his 2034–2043 salary to be taxed at the same rate as the state (or nation) in which he resides following his last game with Los Angeles.
The Red Sox’s first offer for Walker Buehler is to sign a free agent. According to the Tax Foundation, California has the highest marginal income tax rate in the country, taxing the richest earnings at 13.3 percent. Ohtani’s wage deferral beyond the term of his contract is not unique to the Dodgers.
They have seven players under contract this season—Blake Snell, Mookie Betts, Freddie Freeman, Teoscar Hernandez, Will Smith, and Tommy Edman—who can increase their income just by relocating out of state once their deferred payouts begin to accrue.
The Dodgers have revealed the date of Shohei Ohtani’s pitching debut. Although the Dodgers are criticized for exploiting a “loophole” in baseball’s Collective Bargaining Agreement, they are by no means the only team that may provide players with postponed payouts. The same contract arrangement is available to other California sports teams and athletes outside of Major League Baseball.
One has now. Frank Vatrano’s three-year contract deal with the Anaheim Ducks would postpone half of his $18 million pay until 2035 or later, according to Pierre LeBrun of TSN.
“Vatrano will earn $900,000 annually for ten years beginning in 2035, and his plan is to live outside of California (and its tax system) at that point in retirement,” LeBrun said on Twitter/X on Sunday.
Conversely, the Ducks profit from deferred payments because they have $4.57M AAV (rather than $6M AAV) on the deal. innovative approach that works for the player and the team.
… possibly demonstrate to other participants how to stick-handle the California tax problem in the future.” It’s uncommon for a player’s strategy to purposefully evade a state income tax to be made public, even if the Ducks are scarcely the first team—aside from the Dodgers—to provide a comparable wage structure to a player under contract.
The Orioles sign a $15 million contract with a free agent all-star. It is possible that Ohtani may continue to pay California’s state income tax on his $68 million yearly salary after 2033, given he has not indicated where he would reside once his MLB career concludes. However, California State Controller Malia Cohen called on the U.S. Congress “to take immediate and decisive action to rectify this imbalance” caused by “the absence of reasonable caps on salary deferral for the wealthiest individuals” after Ohtani’s deal was formally announced.
Former Blue Jays, Dodgers, and Braves AL Signs a Free Agent It appears that Contender Vatrano has no qualms about publicly announcing his plan to avoid paying state income tax in ten years or using the lack of a “reasonable cap” on his deferred salary. The Dodgers might be leading a trend in professional sports rather than being an exception in baseball.
