Atlanta Journal-Cons ution: Childress leaving Hawks to join Greek franchise

[Obstructed_View]

College players can't get enough money to go on a date, and they typically don't have time or aren't allowed to get jobs. If they don't have mommy and daddy's money, then going overseas to play pro ball is going to get more and more attractive. As the level of compe ion goes up the allure of the NBA will drop. It only takes one blue chip high school prospect or one top level pro to start the tide turning.

[pad300]

European deals are still announced in post-tax terms, right? Every player still pays taxes, none of the deals are tax-free; it's a matter of how the figures are announced.

Correct, it is a matter of how things are reported. Euro press reports contracts in post tax terms. This is because most European countries consider the amount of taxes a person pays to be confidential/legally protected information (ie they can sue if you release it to the public). I have heard estimates that the average (top bracket) tax rate for the NBA cities is 42%. Therefore, translating Euro contracts to NBA terms is as follows.

(Value of Euro Contract)/ (1-0.42) = (Value of NBA Contract)

Value of Euro Contract/0.58 = (Value of NBA Contract)

1.724* (Value of Euro Contract) = (Value of NBA Contract)

Note, if the Euro contract value is not in US$, then you still have to adjust for currency differences. Childress is supposed to be getting $US 20 Million/ 3 years. This is translates to $US 34.5 Million /3 years in NBA terms. This is much better than what the Hawks offered him - he's getting paid the same amount over 3 years instead of 5.

Note to Marcus Bryant. THE TAXES ARE BEING PAID. It's just that the amount of tax paid is not legal to publish in Europe. You can probably even figure it out how much it was from the published data, assuming you know the tax code in the country where they are playing. Uncle Sam will get his cut, it's just they can't legally publish that information...

[The Truth #6]

This is hilarious. People are staking their arguments on interpretations of tax code.

I don't think most American born players really want to play in Europe in their prime. The money can be better, but they're still making millions in the U.S. I think many athletes don't have a positive outlook on living abroad, unless of course there's an "Entourage Compensation Clause" in the contract. I think Childress was uncommon in that he was more open to the idea than others would have been.

If anything, this move will help US players leverage more money for an NBA contract. It could be the reverse Tiago Splitter effect, so to speak.

[Indazone]

Then they are going to receive a not so nice visit from the IRS when they return.

What you are referring to is the exclusion of income earned abroad, which is around $82K. For a $20 mil contract, that won't really help that much.

It will if you stick your money in a Swiss Bank account.

[Marcus Bryant]

It will if you stick your money in a Swiss Bank account.

Doesn't matter to the IRS.

[JamStone]

College players can't get enough money to go on a date, and they typically don't have time or aren't allowed to get jobs. If they don't have mommy and daddy's money, then going overseas to play pro ball is going to get more and more attractive. As the level of compe ion goes up the allure of the NBA will drop. It only takes one blue chip high school prospect or one top level pro to start the tide turning.

The college players that would actually be courted by international teams DO get enough money in college. Let's be real. The ones that are worth an international team going after them are getting paid under the table. The 12th man on Drake University's basketball team isn't going to be getting a very lucrative offer from a pro team overseas.

[FromWayDowntown]

the compensation are based on "Player development" thing that the NBA wouldn;t have any right to claim... maybe high schools and/or universities will get some sort of.. that's what the US system of player development has nowadays... in south america and most countries non us/canada... a player plays in a club separate from where he has his education... and there is where is is developed... form there the compensation for player development they claim when they are transfered...

I'm thinking more of the sorts of fees that are exchanged between football clubs when, say, Ronaldinho goes from Barca to AC Milan (changing leagues). I realize that such fees aren't a staple of international basketball at this point, but I wonder if transactions like this one might encourage FIBA to create rules requiring the exchange of some form of compensation when players are vultured like this.

[Indazone]

Doesn't matter to the IRS.

Why do you think people stick their assets in a Swiss Bank Account anyways?

[Buddy Holly]

Why do you think people stick their assets in a Swiss Bank Account anyways?

To hide money the government doesn't know about.

[kobyz]

he is RFA, Atlanta can match any offer

[Mr.Bottomtooth]

he is RFA, Atlanta can match any offer

If you sign with a team out of the country and/or league, you are an unrestricted free agent.

[Indazone]

To hide money the government doesn't know about.

He's only going to be taxed on that money if he tries to bring it into the USA. I digress however. Josh Smith is next.

Wouldn't it be funny if Josh signed with rival Pana?

[pad300]

he is RFA, Atlanta can match any offer

Olympiakos isn't part of the NBA. It is not bound by the collective bargaining agreement between the Players Union and the NBA. No, Atlanta has no rights in this negotiation. They don't get to match. They don't get to do anything except wave goodbye, once Childress has signed. The only thing they do get, I think, is that Childress remains their RFA with respect to the rest of the NBA teams. When his contract with Olympiakos ends, he will be treated as an RFA by the rest of the NBA. This has no effect on his negotiations with any non-NBA team...

[FromWayDowntown]

If you sign with a team out of the country and/or league, you are an unrestricted free agent.

As I understand it, if he tries to come back to the NBA in the next two summers (09 or 10), the Hawks can match the offer made by the NBA team that tries to sign him. But there's absolutely no mechanism to allow the Hawks to match an offer by a club in a different league.

[Mr.Bottomtooth]

As I understand it, if he tries to come back to the NBA in the next two summers (09 or 10), the Hawks can match the offer made by the NBA team that tries to sign him. But there's absolutely no mechanism to allow the Hawks to match an offer by a club in a different league.

Exactly.

[Marcus Bryant]

He's only going to be taxed on that money if he tries to bring it into the USA. I digress however.

The IRS doesn't care what you do with the cash.

[Mr. Body]

It'll be fascinating when the first player signs abroad during his NBA contract. Does anyone know how this works? As far as I know there are no buyout provisions in stateside contracts because no one figured players would be bolting to play anywhere else.

[spurster]

I wonder what the Hawks were offering Childress. Maybe he didn't like their offer or got tired of waiting.

[pad300]

The IRS doesn't care what you do with the cash.

Quit posting the same stupidity over and over. Please read carefully

http://www.spurstalk.com/forums/show...3&postcount=52

THE TAXES ARE BEING PAID. THEY ARE ONLY NOT PUBLICLY ANNOUNCED BECAUSE OF EUROPEAN LAWS. YOU'RE INABILITY TO COMPREHEND THIS IS GOD-DAMNED MINDBOGGLINGLY STUPID!!!

[FromWayDowntown]

It'll be fascinating when the first player signs abroad during his NBA contract. Does anyone know how this works? As far as I know there are no buyout provisions in stateside contracts because no one figured players would be bolting to play anywhere else.

From a legal standpoint, the player would be in breach of his contract with the NBA team and would be subject to the financial penalties that arise from the breach. Argued creatively, those damages could be rather steep. I would think that the possibility of facing a suit for damages might create sufficient practical disincentive to prevent breaches.

Of course, the player's side might be able to come up with some creative arguments to prove some form of repudiation or prior material breach by the club and use that to justify his own breach.

[Bruno]

Childress going overseas he is a huge event. It will have major consequences.
If I had to bet on something, I would say that the NBA will expand to Europe as soon as 2011.

[FromWayDowntown]

Childress going overseas he is a huge event. It will have major consequences.
If I had to bet on something, I would say that the NBA will expand to Europe as soon as 2011.

Expansion? or a merger that involves some of the top European clubs?

[ChumpDumper]

It'll be fascinating when the first player signs abroad during his NBA contract. Does anyone know how this works? As far as I know there are no buyout provisions in stateside contracts because no one figured players would be bolting to play anywhere else.

That can't happen since all the significant leagues work under the umbrella of FIBA and are bound by its rules to respect each other's contracts. The penalties for attempted cir vention are pretty severe for players and agents; they can include being blackballed from any FIBA league for multiple years.

[Bruno]

It'll be fascinating when the first player signs abroad during his NBA contract.

A player can't do that. When a player signed a contract in Europe or in NBA, his contract is send to the FIBA who checks if he is linked with another team.
If the player still has a contract, the second one is voided.

[Mr.Bottomtooth]

NBA and Euroleague, Greek league, and Russian league should all just come together and create a mega league. They shall call it the AMCBL. The Association of the Multi-Country Basketball League. Any other half-ass league is welcome to join.