← Most Valuable Agent with Matt Hannaford
Most Valuable Agent with Matt Hannaford
What Players REALLY Keep: The Shocking Truth About MLB Taxes & NIL Money
00:59:24
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- [00:13]
A
So, Stephen Caceres, you, I don't know, does, does anybody remember you as a player? What do we think? Maybe locally? Yeah, no, but you. So you play professional baseball with the Kansas City Royals, drafted by the Dodgers in 2000. Oh, see, I didn't even know that.
- [00:26]
B
Ninth rounder, man got fourth round money.
- [00:28]
A
Hold on. So like, let's go into your baseball journey just, just briefly because lot of the listeners, you know, parents of youth and travel baseball parents, they, they have kids who have aspirations of going to playing college, going to playing professional baseball. So you were somebody who, who did that. What was your senior year in High School?
- [00:47]
B
2005.
- [00:48]
A
Okay, so 2005, at that point, I'm a little older than you. At that point, travel baseball was already a thing.
- [00:55]
B
So travel baseball was. It was basically you start at like 13, 14, you know, and it was, it was very localized. Hey, you know, I grew up in the suburbs of New York City. So, you know, I lived in Rockland County. You might go into the Bronx to play or Westchester County. You know, we weren't, we weren't doing crazy stuff. But when I was 16, I joined a kind of more of a regional team. It was called the New Jersey Twins. And we were basically coming down to Virginia every weekend and just playing against some of, some of the bigger name teams and just getting exposure outside of our local area. But it wasn't the huge thing that it is now. It's really changed in the past 10 to 15 years. You know, even since I got out of my playing days of pro ball, it's really just exploded.
- [01:43]
A
Yeah, I mean, so I was a senior in 1999, which is definitely dating myself. Not too bad. Travel baseball at that point, I mean, it was pretty much non existent. I mean, there may have been like a local team, but primarily guys would play in American Legion. So. Yes, you play travel baseball. You ended up going to college, right?
- [02:01]
B
Yes. Went to James Madison in Virginia. Yeah, I wanted to go south somewhere. So I was getting recruited by some Ivies and stuff like that. I had decent grades, but I remember I, I had a distinct conversation with my mom. I was like, I don't want to go north to play. I want to try pro ball. I want to see what happens. I got to go south. I really want to go to uva. Ended up at jmu. They had a Sean Doolittle there at the time. He was a year older than me and you know, the coach. I always have great things to say about those coaches. They may not remember who I am, but they they said, hey, Steve, we have Doolittle here when he's not pitching. You're probably not going to play right away. And then JMU was like, you know, we want you here to play. So ended up, ended up going south and playing, playing there. I didn't want to be too far away from home either. You know, I, I still have a tight relationship, very tight with my parents and wanted them to be able to see me, to play nice.
- [02:54]
A
Yeah, I, I, I have to imagine a lot of the players listening would probably say the same thing. Right.
- [02:58]
B
They are your number one supporters. You know, you can have, you know, there are great coaches and there are people that, you know, feel like fathers and, and mothers to you, but for me personally, that's, those are my, my two number ones.
- [03:12]
A
So you are somebody who is a CPA for athletes.
- [03:15]
B
Yes, yes.
- [03:16]
A
I want to, I want to jump into that because I think a lot of the, the parents who, who listen to this, I think when they think about CPAs, they think about people that maybe are a little older.
- [03:24]
B
Correct.
- [03:24]
A
You know, maybe their local CPA who handles, you know, the local businesses and maybe some doctors and lawyers and whatnot. But a CPA for a professional athlete is vastly different. What's required of you for them looks a lot different than if you were just doing a tax return, let's just say, for a local business. So let's get into that a little bit. You, because you played pro ball, and the reason why I wanted to bring that up is, you know, very specifically how these guys get paid.
- [03:50]
B
Yes.
- [03:50]
A
What they go through, how they, you know, you don't really make much money early. When you have an opportunity finally to make some money, whether it's out of the draft or in pro ball, the window of making that money is very small.
- [04:01]
B
Right.
- [04:01]
A
So one of the things that I've always instructed players is like, it's not that the local guy is, is bad.
- [04:07]
B
No.
- [04:07]
A
Right.
- [04:07]
B
And I stress that a lot.
- [04:08]
A
Yeah. It's, it's just that he's not as well versed in how athletes make money. So they're going to be things that we jump in on this podcast, like duty days and things that you have to kind of calculate and be aware of that a normal cpa, it's not that they don't understand or know. They may just miss it. They may not be aware of how guys are paid. So their advice or the things that they're doing for you just may look a little different. So let's start, I guess, with the first thing that would probably, I imagine, be on the parents mind, which is the signing bonus, right?
- [04:41]
B
Yeah.
- [04:42]
A
So as you're working with the family going through the draft, what are the things that you would be instructing or talking to them about as it relates to the signing bonus?
- [04:51]
B
So the signing bonus is obviously. Well, things have changed now with what can happen within baseball because of nil. So there are some top picks that are getting money at 16 years old from sponsorships and stuff like that. At least when, when I was around that didn't exist. So it was your first shot of making money off, off of playing a game. And you know, as your mentality when you're growing up, it's, you know, wow, I'm going to make money playing, playing a game that I've played since I'm 5 years old.
- [05:20]
A
This is, yeah, I would like, I would do it for free and they're going to pay me.
- [05:23]
B
Well, it's amazing, it's incredible. But then all of a sudden you have this tax chunk come out and you don't know what it's, what it's for, where it's going, why. And of course, you know, if you have an agent, you have agent fees and stuff like that. So you think, hey, I'm, I'm getting a signing bonus for $500,000, a million.
- [05:42]
A
Dollars, and I'm getting 500,000 or a million in my bank.
- [05:45]
B
Yeah, you think you're getting that when, at the end of the day, once, once everything's run, you know, it's looks much different, 60% of that. Right. You know, so getting back to your question, you know, as far as navigating the draft, you know, we want to set up things before the draft where we can put the player in the most advantageous tax situation. So what that really means is you're always going to pay federal taxes on, on what you, on what you earn. There's no, there's no way around that. There's no way of, you know, you can see things online of people saying, well, you do this, you do that, set up an llc, can't do that. Team is paying you directly to perform your services.
- [06:25]
A
So let me, let me just touch on this because if you're a player listening to this, I want to make sure that you understand. So when you get paid for your signing bonus, right, there's two components. One is the federal tax.
- [06:36]
B
Correct.
- [06:37]
A
One is the state tax.
- [06:38]
B
One is the state tax. If you live, if, if you are in a state, if you're a domiciled or a resident of A state that has state tax, obviously, Texas, Florida, Washington state, Tennessee, guys, they have nothing to worry about. I remember actually when I first signed and we, we were all in the clubhouse comparing our signing bonus checks, and one of my buddies, he lived in Texas, and I was a New York resident. I was like, it's like, damn, dude. You know, he's signed for more money than me. I was like, damn, you kept a lot more than I did. But there, you know, he was a Texas resident. So getting back to the point is, if there are things that can be done where we can establish either domicile is the easiest part of establishing where you are as far as where you're going to get taxed or residency in another state, there's two different things here, and we'll get into that later. But if there are things that can be done to make that process happen now before they receive the money, there's reasonable cause to say, hey, you know, this person doesn't live in California anymore. They're a resident of this state. We want to withhold taxes in this state and pay. And pay the state taxes there or pay no state taxes there.
- [07:51]
A
Right. So let's, let's, let's, I guess, get a little bit more specific for the listener. So prior to the draft, yes, you essentially. And we've done this obviously together, but you essentially say, okay, who are the teams that potentially have interest in drafting you? All right, it's these. Let's just say it's these 10 teams. Okay. What's the amount of the signing bonus that you would reasonably expect that you would make? Okay, let's say, for argument's sake, it's a million dollars. Right. Okay, so $1 million. What you essentially do is say, let's look at what that would look like if you're a California resident and you're receiving $1 million from the L. A. Dodgers. Right. This is roughly what it would look like from a tax. Tax perspective.
- [08:32]
B
Right.
- [08:32]
A
We'll also show you what it would look like if it was the Cleveland Guardians, the Miami Marlins, etc. Right, right. Yeah. So the family gets to see. Okay, I can totally understand then, if this is where I'm a resident, this is where I'm domiciled, to use your term. This is how much I'd be looking at if I was drafted by this club. This is how much I'd be looking at if I was drafted by this club. Now, another component to the signing bonus is obviously, well, how is the money being split up? Most teams, if you're Signing for a number like a million dollars, you're going to split that payment up in two separate payments. Correct.
- [09:03]
B
That's a great thing that they do. And they've been doing that for as far back as I've been practicing and that's what they did with me. They split it up over two tax years.
- [09:11]
A
So to give everybody an idea, the first component.
- [09:14]
B
Right.
- [09:14]
A
And it is somewhat negotiable as far as how much is applied in the first payment versus how much is applied in the second. The first payment is traditionally paid out anywhere from 15, to call it 30, 60, 90 days after the draft. Right, Right. The second check, that gets paid out the following January through roughly April. Right. Okay. As you're going through this with the families, explain why it's advantageous to split it up into two payments.
- [09:41]
B
It's advantageous to split it up over two payments because you're in two separate tax years. So for someone, and I want to use a number like 500,000 because that's where the tax brackets, we can use a million, but the tax brackets are kind of, you know, it's immaterial at that level. So someone signing for $500,000, if they get that lump sum in that one year, they're going to pay somewhere in between a 32 to 37% tax rate on that money. That doesn't include endorsement income or anything like that. But they're going to be in a very high tax bracket. By splitting it that $500,000, they get 250 in one year and that basically puts them in the 22 to 24% tax bracket. Same thing the next year. We obviously know what minor leaguers make, basically doesn't move the needle on a tax return. So the clubs are doing a favor by splitting it up over two tax years because you're keeping more money in your pocket by being able to do that. And really they're splitting it up over a four month period.
- [10:46]
A
Right. It's not, it's not like you're getting it five years later.
- [10:48]
B
Yeah, yeah. So I mean they're, they're fulfilling their obligation to pay the signing bonus. The, the, the players fulfilling his obligation by playing, showing up. And it's basically done in a, from the time that they are drafted, six to eight month period, they have their full signing bonus. But by splitting it up over two years, they're saving substantial, you know, could be tens of thousand dollars, tens of thousands of dollars splitting it up over two years. And that doesn't include the state tax return either.
- [11:14]
A
Right. So okay, so in my example, kids with the LA Dodgers, and we'll use your number of 500. You know, we run the numbers and we figure out, okay, this is the best way to split it up. And let's assume it's 50. 50.
- [11:25]
B
Yeah.
- [11:26]
A
Okay, so the Dodgers are going to apply the first payment to the resident of California that I'm referring to.
- [11:30]
B
Correct.
- [11:31]
A
Okay, so now a lot of families are like, well, what if we just buy a place? Let's say he's, he wants to buy a place in Arizona, right, Which is where spring training is with the Dodgers. Or we want to create residency in Florida, right. So that we can lower our second half payment to potentially being paid out in Florida. Walk through that dynamic, because I think some people think it's black and white, like, oh, this is just how it's done. We set it up right, we're good. Share, share a little bit about. Well, it's a little bit more intricate. There's some nuance there.
- [12:04]
B
There is definitely nuance. And California and New York are the two most aggressive states when it comes to getting their money. Big states, high tax rates, they have very, I don't want to say aggressive, you know, departments. It's, you know, they're, they're very hands on. They're very hands on and they're protective over what money they want.
- [12:24]
A
They want their money.
- [12:24]
B
They want, they want their money. So you, you can't just be like, oh, well, I was in Florida for spring training, I played the whole season in Florida, and therefore I was there for this many days, therefore I'm a Florida resident. It just, it, it doesn't work that way. California may not come back in, in a year, two years, they may come back five years from now and be like, you were here in California. We want a chunk of that money regardless of where the team source the money to. And that's another thing that we can, we can give.
- [12:58]
A
I want to touch on that after you finish this.
- [13:00]
B
So, you know, things to do, to be proactive, to really get yourself out of California, or I keep using California or any kind of tax state to somewhere that's lower or a state with no tax. You know, really it comes down to the intention of the individual. You know, do they have, in their mind, there's cases all over the place where people have left for five or seven years and they went back to their home state and the state has said, well, you never really had intention of leaving here. You were just, you just left for work, basically.
- [13:36]
A
Right.
- [13:36]
B
So we're coming for your money.
- [13:38]
A
Right.
- [13:40]
B
So it's, it's the intention. Do you really intend on leaving the state permanently or for whatever time period and by doing that is, you know, where do you own a home, where do you rent a home, where is your driver's license, where do you vote? Is a big one. Another one that has come up is where do you see your doctors? I mean, they get into real personal stuff. Where are your doctors located? So it's, it's really about, you can have all the paperwork and all this stuff, but it's really about intent, what you really, really want to do to show to that other jurisdiction, hey, I'm not here anymore. Right. And again, not necessarily going to happen with someone signing for $500,000 out of a draft. Yeah.
- [14:30]
A
But if it's 5 million.
- [14:32]
B
5 million, completely different public, individual, as you know.
- [14:36]
A
Yeah. You're a first round pick, People know your name.
- [14:39]
B
It's exactly.
- [14:40]
A
You've got a spotlight on you.
- [14:41]
B
Exactly, exactly. So it's really about intent. And then what you do after that to make that intent known.
- [14:50]
A
Right.
- [14:51]
B
As to, hey, I'm out of this state, I don't have plans right now of going back. And if I do go back, it's because of this.
- [14:58]
A
So. And again, this is all advice, obviously. Everybody listening. Yeah. This is, yeah.
- [15:03]
B
This is not taxes.
- [15:04]
A
Right, right. You, you have to speak to a c. Because there is nuance with all of this stuff. So this is more just general ideas. Yeah, exactly. But let's talk about that more famous top prospect out of the draft who, let's just say signs for $5 million. California resident. What are you saying to him as far as, all right, look, you want to go to Florida and purchase a home.
- [15:30]
B
Yeah.
- [15:31]
A
These are the various things at the bare minimum that you need to make sure that you do. Right. You mentioned, you mentioned the doctors.
- [15:39]
B
Well, that's kind of driver's license.
- [15:43]
A
Right. So then you get a driver's license in that state of Florida. Vote, register to vote in the state of Florida.
- [15:48]
B
Correct.
- [15:49]
A
What else?
- [15:51]
B
A kid, a 21 year old guy or 18 year old kid might not have, have his own children. But that's more for, you know, guys who are establishing the big leagues. But where do your kids go to school? You know, it's just, where are you doing the majority of your life? Where, where are you doing that? So anyway, getting back to, to the draft, it's. How are we going to sever your ties to this high tax jurisdiction state as fast as we possibly can, you know, and if we can't do it in the draft year. Can we do it for the second half?
- [16:21]
A
Right.
- [16:21]
B
Where, you know, the first half of the signing bonus. Yeah, it gets sourced to California. You take your lump there. But at, you know, for the second half, you know, maybe after you got drafted and you went down to the complex in Florida or Arizona, you know, you bought a place, you did all the things you needed to do starting, you know, starting in, we're in 2025 now. You did this in August of 25, you know, starting January 1st of 2026. You know, there's a reasonable case, a really good shot that we are, you know, doing everything we have to do to establish that you are in fact an Arizona or Florida resident.
- [16:56]
A
And the best rule of thumb, I think is don't necessarily look at it like what's the workaround? But it's more about, look, if, if we're going to purchase a home in Florida and we're going to, you know, register to vote and get a driver's license, we need to treat it as though you're living in Florida. So you need to live in Florida. Not, oh, we're just going to do this and make it look good, but really live in California to get out of it. Like, that shouldn't be how you look at this.
- [17:19]
B
You're exactly right. Because there's, there's two, there's two things here. You have, you have domicile. Yeah. Where you're domiciled. So those are the things that I kind of touched on. That covers the domicile part of it. There's also Residency. That's the 183 day test that most states are, that, that's kind of the rules they go by. Where are you for 103, 183 days out of the year? If you can't hit that, they don't really care.
- [17:48]
A
Right. So think about this. So you have this kid who signs for a lot of money out of California. He buys a home in Florida and does everything right. Right. He, I mean, when you say 183 days, it's like, well, he's playing during the season, so he may not be in Florida for 183 days.
- [18:03]
B
Correct.
- [18:04]
A
So then where are you spending your off season? If you think you're just going to go back to California in the off season, then you're not living up to that 183 day trigger.
- [18:13]
B
And you could be, you can be domiciled in Florida by doing all those things, but you know, you spent the majority of your days In California, you are a resident of California for tax purposes, and you're going to pay your, your share of taxes to California for that.
- [18:27]
A
So I want to talk about now from the team standpoint and them, like, where do they apply the second payment? What is, in your experience, the thought process of a major league organization and how they typically handle how they apply that second.
- [18:42]
B
So in the past, they were usually just sourcing it to the players home state. So when I signed, they, they sourced both payments to New York. I was in Ogden, Utah, and then my second year I was in California. You know, they, they sourced my playing days to Utah or California, but the signing bonus went to New York. That's done. Now they're sourcing it to where they're going to assign the player.
- [19:08]
A
Right.
- [19:08]
B
So it's very interesting for the tax perspective.
- [19:12]
A
And then when does the team need to make that determination? Because if the players drafted in July, the bonus gets split up.
- [19:20]
B
Yeah.
- [19:20]
A
Are they having to make that determination then or are they making that determination when that second payment is paid? Because the reason I bring it up is if you're making the decision out of July. Well, it's, it's a guess, right? Oh, we think we're going to send him to this place, but it may not be actually where they send them or are they making that decision when they make that second payment? And at that point they would know, all right, yeah, we're going to send him to, you know, New York.
- [19:46]
B
Yeah. So it's funny that, you know, just like every organization and every, every company, there's, they do things differently. So you're not going to get the same approach from the Braves or the, or the Diamonds. I see it all the time. I talk with other people in the field and it's like, well, this is what they do. But, oh, I wish he got drafted by this team because this is what they do. So from, from my perspective as a, you know, a tax professional, there are, there are some organizations that are easier to work with as far as where the money is getting sourced, as far as the first payment. Most likely they're going to source it to either where they're, you know, where they play, where they're going to, where they are going to be assigned, or just their home state.
- [20:28]
A
First payment.
- [20:28]
B
The first payment, yeah.
- [20:30]
A
In my, in my experience, I feel like every, every player, the organization applies it to where he is in that moment. Right. So if he, if he's. Because, again, you know, and not to get overly complicated, but there's a difference between a True signing bonus and actually something that we don't want as salary.
- [20:49]
B
We don't want to get to that.
- [20:50]
A
I don't want to confuse people, but if it's the California resident, you're earning that first check by being a California resident in California. So let's assume that's the first payment, the second payment, again, where do we think we're going to send that player? Going back to my question, when do they make that decision? In your experience?
- [21:08]
B
It's probably, that's actually a good question. I mean, it's probably where they project them to go and when they're making the payment, you know, well, we're probably going to send him to low a next year.
- [21:18]
A
So have you ever, and this is why I'm asking the question, have you ever had a team source it to the wrong state? He doesn't go there. And then do you have the ability as his tax professional to then go back and say, actually yes, he wasn't in New York, he was in Florida. We need to make an adjustment.
- [21:37]
B
Yes. So we, we can do that on the tax return. It's, it's much harder and pretty much impossible to go back to the team and say, hey, change this.
- [21:44]
A
Yeah.
- [21:45]
B
So why is that? Because the stuff has been filed already.
- [21:48]
A
Yeah.
- [21:49]
B
And they're not, they're not interested in. And it's not, it's not like blaming them for it. It's just they don't, it's.
- [21:55]
A
They did what they did and they.
- [21:56]
B
Did what they did. They made a decision, they moved on. And, and that's it. It, it's a lot of paperwork, a lot of moving stuff around and all that stuff. So, you know, getting back to the original point of kind of this whole thing of why we're talking, it's getting someone who knows how to navigate the states and being able to first of all present the tax return in a way to the, to the jurisdiction that you need to refund all this money and then putting a statement on the tax return. Here's why. And then if they come back with further correspondence through the mail, unfortunately you got to send snail mail. Why we have this position that we're taking and most of the time that's successful there is a little bit off topic, but there is something where one of the agencies I worked with, the past preparer, had all of the tax returns addressed to their address in Illinois. So they all the mail would go to their office. Well, we're still Getting letters from 20, 18, 29, 19 tax years from Illinois saying this was the address you used. You did not file an Illinois residency return. You owe us this money. And then we have to correspond back with them saying, hey, here's the situation, here's why, you know, we use this for convenience, blah, blah, blah. And it wasn't me who did it, but it's just explaining the situation. We don't owe this money. Here's a copy of their driver's license. Here's a copy of their bank statement showing their address where they were. Hopefully this clarifies it. And it usually cleans it up so it's more back end cleanup if the team were to source something to where someone never was.
- [23:39]
A
Right. A lot of your job is if you're getting a player, let's just say after he was drafted, is going back and saying, okay, was this done properly?
- [23:47]
B
Yes.
- [23:48]
A
Was it not done properly? Let's then clean it up at that point. Which again, not to belabor the point, but it is why it is so important for these people to deal with CPAs who have the experience of having worked with professional athletes.
- [23:59]
B
Yeah, 100%. 100%. Because, you know, again, this is not talking down on someone who doesn't know the industry. There's plenty of fine CPAs and accountants out there who know what they're doing, but they'll see what the W2 says and they'll just go off what the W2 says as, as far as it's. It's gospel.
- [24:19]
A
Right.
- [24:19]
B
You know what I mean? Well, it was sourced there. It's got to be tax there because they don't really know how to do the process after the fact.
- [24:26]
A
Can you give me an example, though, real fast of somebody that you got after the fact, you then went back and you said, oh, this shouldn't have happened.
- [24:35]
B
Yes.
- [24:35]
A
And then got him money back.
- [24:37]
B
Yeah. So it was a client, he was from New Jersey, but had full year residency in South Carolina. South Carolina, lives there the whole off season. Not a big difference as far as taxing, you know, maybe a 4%, you know, difference. Team source all the money to New Jersey. So what that means, though, at the same time is you're getting money out of New Jersey, but now South Carolina, you're a resident there. So you're, you have to go and now pay taxes to South Carolina to net out that difference that you're going to save. You know what I mean? You're going to get the money back from New Jersey, but you're also telling South Carolina that, hey, I'm a resident of your state. I didn't have any withholding on this money. I need to pay you now. You know what I mean? So.
- [25:28]
A
How much did you end up getting back for him?
- [25:31]
B
I can't really remember the signing bonus. It wasn't, it was anything crazy, a couple of thousand dollars. But I mean, you know, it helps.
- [25:37]
A
Yeah.
- [25:37]
B
You know, and nothing, nothing ever came back of that. But, you know, a lot of the stuff we do is we put our position out there and see if it comes back. And, you know, the thing is, you want to have all. All your ducks lined up in a row where you put a position on a tax return and you can easily defend it.
- [25:55]
A
Right.
- [25:55]
B
And, you know, a lot of. If there's any CPAs out there listening, you know, a lot of. A lot of our work is that is making sure you have all the documentation to defend a position you're. You're putting on a tax return.
- [26:08]
A
All right, so I mentioned something earlier, and I want to. I want to just clean it up for people who may be wondering, well, yeah, go back to that thing you said and what does this mean? So I'm gonna. I'm gonna say it as. As easy as I possibly can. It is super complicated.
- [26:22]
B
Yes.
- [26:22]
A
But I do find it important for everybody to understand. So there is a difference between a true signing bonus.
- [26:29]
B
Yes.
- [26:29]
A
And regular. And what's confusing about it is people hear, yeah, but it's a signing bonus. So isn't all of it a signing bonus? The IRS doesn't look at it that way. Right, right.
- [26:40]
B
Or neither. And the teams as well.
- [26:42]
A
Well, exactly. Yeah. So what I mean when I say true signing bonus. A true signing bonus is something that you are given and you do not have to pay it back in the event that you retire. You don't live up to your end of the bargain. You know, you may violate the contract. And there's a stipulation in that agreement language in the agreement that essentially says if this happens, you have to pay back a portion of the signing bonus or that language is in your draft contract that is not considered a true signing bonus.
- [27:10]
B
That's correct.
- [27:11]
A
Okay. So the thing I want to make sure people understand is organizations aren't quick to want to give you a true signing bonus. That's correct. We are talking about a really, really small percentage. So much so that it's almost non.
- [27:24]
B
Existent.
- [27:25]
A
Almost like maybe a couple guys a year.
- [27:27]
B
Yeah.
- [27:28]
A
So if you think about it from that perspective, we're really talking about a very special player at the very top of the draft that a team may be open to the idea of giving you a true signing bon. But for the majority, the lion's share of players, 99.9% of them, a team is going to be unwilling. So if you're a player, let's just say who signs in the 10th round, don't think that, oh, let's just ask the team to give us a true signing bonus and let's just make sure that the language is protected where we don't have to pay back. Think about it from the team standpoint. What is their incentive to do that? If you say this is what it's going to require, they'll say, yep, no thanks, we're going to go take somebody else. So it is something to be aware of, but it's not, it's not anything that a family needs to like obsess over unless they are considered kind of the very, very top of the draft.
- [28:11]
B
You're absolutely right. I mean, you know, pretty much after you, outside of the first round, you know, you can always bargain and negotiate over money, dollars and cents. But stuff like that, you know, establishing what a true signing bonus is for and giving them, giving the player a true signing bonus, I mean, it's almost non negotiable. You know what I mean? They're just, unfortunately, it's just. You're just another commodity at that point.
- [28:37]
A
Yeah, no, you're absolutely right. You're absolutely right. Okay, so let's now go into professional baseball. Tell these people how baseball players of the minor leagues are paid. Are they paid per month or you know, bimonthly, bi weekly.
- [28:53]
B
So it's usually every two weeks or bi. Monthly.
- [28:56]
A
I'm asking the question rhetorically, but I. Yeah, yeah.
- [28:59]
B
It again, depends on the organization, but usually it's twice a month. I remember the Dodgers paid us twice a month.
- [29:05]
A
And from what time frame?
- [29:07]
B
From the time frame that you are actually in the championship season. That is the.
- [29:11]
A
Right. So during.
- [29:12]
B
Phrasing.
- [29:13]
A
Championship season is just during the baseball season and includes the playoffs, but that is what's considered the championship season. So in the off season you're not getting paid by the organization.
- [29:22]
B
Correct. So so effectively six, five, six months out of the year, you're not getting paid. So you see someone making $20 million throughout the year, they're getting that money over the course of the regular season.
- [29:33]
A
Right, exactly.
- [29:34]
B
It's not the playoffs.
- [29:35]
A
Right, True.
- [29:36]
B
That. That's different.
- [29:36]
A
True. Okay, so that covers that component. Now let's go into, I guess maybe a contract that a lot of people are familiar with and a lot of, a lot of a lot of people in the industry have pointed to or touched on that is unique and different. Right. And it's Shohei Otani's contract. So in Shohei Ohtani's contract, I think it was 98% of the contract is deferred 10 years out into the future. Right. So 98%. So he's getting 2% of his contract value for the first 10 years of that agreement.
- [30:10]
B
Something like 2 million bucks a year right now.
- [30:13]
A
There was obviously strategy involved with why they did that. What it allows Shohei to do is when he eventually gets the. The remaining 98% after that 10 year period when it starts to get paid out. If Shohei wants, he could leave California, assuming he's not playing for the Dodgers. Let's just say he moves back to Japan, which is where he's a resident, and he receives that money and it doesn't get taxed. However, it would still obviously at that point, if he's getting that money while he's in Japan, Japan would have to tax it. So the thing I want to make sure that people understand is it is super complicated.
- [30:50]
B
Yes.
- [30:51]
A
It is. Not black and white.
- [30:52]
B
Yes.
- [30:53]
A
It's not as easy to say as, oh, that was a brilliant move. Correct. I will be the first to tell you, as an agent who's negotiated deals, who've worked through a lot of these tax consequences, there's a lot of different factors that are in play.
- [31:05]
B
100%. We're just part of, we're just part of the whole thing.
- [31:08]
A
Yeah.
- [31:08]
B
You know what I mean?
- [31:09]
A
To, to one player, he may say, well, there's, there's no world in which I would ever consider doing this. Right. In Shohei's case, it sounds like he was open minded to it because he was thinking, well, I want to help out the Dodgers. Right. I want to provide them the ability to spend a little bit more money while I'm playing for the Dodgers. And in his case, because he was making so much money off the field, he said, look, I'm going to make my money anyways. I don't need this money during this time. The thing that I want to bring up and point out though, for everybody listening is again, talking about the state of California, a very aggressive state.
- [31:44]
B
Yep.
- [31:45]
A
So at least from what I understand about the tax law. Yeah. I mean, basically there is a loophole on some level where he was able to do this. Now, what are your thoughts as far as California changing the law and wanting to come back and say, well, because when you're talking about like a High profile player.
- [32:01]
B
Sure.
- [32:02]
A
I mean, everybody is aware of this. So.
- [32:04]
B
Yes, the world, the world knows.
- [32:05]
A
That's right. I've heard, I've heard plenty of people in the industry who have been like, oh, the state of California is going to definitely want to change that law to, you know, again, get their money at that point. Yep. But what, I guess my question for you is more about, like, what were your initial thoughts when you saw that? Is that what you would have done? Is that. Or how would you have evaluated that situation?
- [32:27]
B
So the tax nerd in me, as me and my buddy like to call it, thought it was fantastic from a, from a tax perspective. So what's happening? Like you said, I mean, he's getting a small salary of $2 million for whatever the. I think it's 750 million or something like that.
- [32:47]
A
780 million.
- [32:49]
B
Even more so.
- [32:51]
A
No, it's 680 million.
- [32:54]
B
Whatever it is, it's. And my personal opinion is it's not.
- [32:57]
A
Enough, but we won't go there.
- [33:01]
B
So that $2 million that he's making throughout the year, whatever. What. I don't, I don't, I'm not privy to his personal financial situation.
- [33:12]
A
That's an important point. And again, like, we can sit here and we can pass judgment, say it was great or not good.
- [33:17]
B
Yeah.
- [33:18]
A
The reality is, again, having been on the inside of deals, there is so much information that we are not privy to. We don't know that that would go into whether you should or shouldn't do it. And this is why, again, everybody needs to have their own tax professional and not use this as advice on what they should do. You know, in, in. There's so many other components to that contract too, which is like, oh, well, he's getting the money without interest. Right. Should he have gotten interest in the contract?
- [33:44]
B
Now?
- [33:44]
A
I would make the argument yes. But again, you know, as his agent, maybe his agent basically said, you know, I tried to get interest. They said no, he was going to sign there anyways. We don't know.
- [33:53]
B
We don't know. Right. And that's fine. What we can assume based on the facts is that if Shohei Ohtani is a California resident making $2 million, of course, endorsement deals, all that other stuff, if he's a California resident staying here, domiciled in California, he's paying California state taxes on that money while he's playing here right now. Yeah. The amount that he's deferred when he starts getting paid that amount in 10 years, and they structured it where it's 10 years down the road from now. So there's specific language that says it will not. For right now, that it will not be subject to California state taxes. So after 10 years, who knows what happens? But if we assume he goes back to Japan, he will still pay federal taxes on that money.
- [34:42]
A
Right. Which is funny. Federal taxes in Japan are higher than the United States.
- [34:47]
B
Correct. So, I mean, the United States is one of two taxing jurisdictions in the world where you fall under what's called Empire tax, where every dollar you make throughout the world needs to be on your US Income tax return. So however all that shakes out between the US and Japan, you can let his CPA deal with that. But the bottom line is that that deferred compensation will be taxed in the United States. What he's really getting around is the California state tax for him, which is 10, you know, upwards of 10%.
- [35:24]
A
Right.
- [35:26]
B
Which over the grand scheme of things, I don't know what the numbers are.
- [35:28]
A
13, 3.
- [35:30]
B
That's what I'm saying. It's, it's, it's ridiculously high, especially for those numbers. So if we're deferring, you know, just, just on. Let's just stay conservative here. Out of 2 million times 10 is what. It's 20 million. Out of 780. 6.
- [35:45]
A
80.
- [35:46]
B
680. So 660 is getting deferred, you know, assuming. Just. Let's just assume 10% for nice round numbers.
- [35:53]
A
680 is getting deferred of 700. Sorry, I just want to.
- [35:55]
B
680 is getting deferred of 700. You know, let's just assume 10% for nice easy math. I mean, $68 million. Yes. So that gets back to your interest there. Did that pay for the interest? You know what I mean?
- [36:06]
A
Yeah, well, you know, and the interesting. It's an interesting topic which we don't need to spend too much time on. But what is the. The. If I could use a visual, it's almost like the team said to Shohei, Shohei, loan me.
- [36:23]
B
Correct.
- [36:24]
A
Loan me 600. Excuse me, loan me $680 million. We're going to be able to earn interest on it, but you're not going to be able to correct.
- [36:32]
B
Yeah, I mean, the time value money suggests that his contract is probably somewhere right now in today's dollars worth.460. Is that what the number is? I was going to say 450 off the top of my head. So really it comes down to what the player and what the client wants to do. You know what I mean? To him, it made Sense to you in the industry. It may not have made sense for me. I was like, oh, this is brilliant from a tax perspective. Yeah. But again, that's not to say, you know, high profile athlete that they come back and change something. You know what I mean? It just, it is what it is. So for right now, that's what it was.
- [37:15]
A
Okay, let's talk about nil. Yeah, right. Again, the listener as a kid who is I would imagine certainly considering going to college.
- [37:24]
B
Yep.
- [37:25]
A
There's an nil piece that is something that is as big today as it's ever been.
- [37:29]
B
Yeah.
- [37:31]
A
You're a college player who is going to end up at university and you receive a decent nil package. Right. There's obviously rev share, there's the nil piece. What are the things that they should be thinking about from a tax perspective as far as how things should be set up? Should they get an llc? What does that look like? What would be your advice or how would you. Maybe this is a better question. How would you advise or talk to one of your clients who is going through this?
- [38:05]
B
So it obviously depends on the amount of money that the client is getting. You know, you don't have to get an LLC right right away. Depends on again the dollars and cents. When you start adding zeros, things get more serious, more planning, more things that we have to talk about from a, from a tax perspective, let's level set real fast.
- [38:29]
A
Why would an LLC even make sense if they were making enough money? Like why is that Admin?
- [38:35]
B
So an LLC gives you the option for someday down the road to establish that as what's called an S Corp, which is a whole nother nerdy thing that I can get into where it'll save you taxes. From an LLC perspective, if you just go out one day and say, hey, I'm going to, I'm going to do an LLC for tax purposes. It's what's called a disregarded entity. It's still reported on your personal tax return. If you make $50,000, you're going to pay self employment tax on that money. You're going to pay regular taxes and if state is applicable, you can pay state taxes on that money. Not a lawyer, don't pretend to be a lawyer. LLC protects you from certain things that they can't come after your personal assets. All that other stuff from a tax perspective does not change a thing. You can be a. It's basically like you're a sole proprietor, like you're selling lemons outside or something. Collecting money from that. What the LLC Enables you to do, however is again gives you that option where if you start bringing in enough money, you can elect a file as the S Corp and start paying yourself a wage out of there from the company. So basically you have ABC LLC in one pocket, John Doe in B pocket, and the LLC is collecting all the money and you have it in this pocket and then you run payroll and give the yourself the wages. What that enables you to do is you're paying into your Social Security, FICA taxes and all that. But there's specific rules in the IRS in the Internal Revenue Code that allows you to basically pay yourself what's called a reasonable salary. And whatever's left over in that LLC still gets taxed on the federal tax return, but it's not subject to the self employment tax anymore.
- [40:30]
A
So you know, so essentially you're paying.
- [40:33]
B
Less taxes, you're paying less taxes. But you know, you hear and there's tons of stuff out there, oh, I gotta do an llc, I gotta do this, gotta do that, gotta be able to deduct this. Want to get a car, deduct it again, each situation is totally unique to the client. The LLC gives you some flexibility to do things now or in the future that will help you save taxes. But you know, again we're talking where it really makes sense is for people that are making good serious money from this nil money. If, if you're watching this and hey, I'm getting $15,000 to go play, I, I have a client, a woman basketball client, she plays basketball, Marquette, you know, makes about 20, 25 grand, which is great. I mean it's great that, that they're doing this, but doesn't make sense for the client to go through all these hoops to save, save nothing. So again, really depends on the situation. But the LLC gives you that flexibility where you can contact the institution and be like, hey, I don't want it sourced to my personal social, I want it to go to my LLC and I'll take it from there.
- [41:45]
A
So what, what? And correct me if I'm wrong, what a parent listening to this should do is when your son goes to college and they broker whatever the nil package is, they should talk to a CPA and say, educate me on an llc. Does it make sense given how much that I'm going to make or does it not like that that is what they should do. Have the conversation. But don't just assume we have to.
- [42:11]
B
Do this 100%, 100% tell everybody, assuming.
- [42:14]
A
That they did do it, assuming that that was what they want to do. What is the process to set up an llc?
- [42:19]
B
So the process to set up an llc, you know, you can set one up in your home state. Let's ignore everything we talked about earlier. You know, set up, set up an LLC somewhere that you know that either you're living or going to be living or something like that. Go on to you. You can do it yourself if you want, or you know, you can pay an attorney to do it, get the paperwork done. Basically incorporate as an LLC in, in a state, you get the certificate, you apply for ein number through the irs, go get a bank account with that ein number and voila. Yeah, you're an llc.
- [42:58]
A
The process, it isn't super complicated.
- [43:00]
B
It's not.
- [43:01]
A
However, there are some things that you want to make sure that you do properly. So definitely talk to a cpa. Again, you brought up an attorney. We've obviously done this and have had attorneys file the paperwork, draft all the documents. So it's nothing that you necessarily have to do on your own. No, I would personally advise you guys definitely speak.
- [43:22]
B
Yeah, let me actually take that back about doing it on your own. Speak to someone first.
- [43:26]
A
Do a professional. Well, and even look, if they decide to do it on their own eventually because they think that they're well equipped and they could do it, okay, great. But just know that you're going to want to make sure that you do it in the right way. Okay. So let's now move forward into their professional career. So now they're in pro ball, they get called up to the big leagues. Okay, let's talk a little bit about how taxes work from the standpoint of, well, you're going to go travel to a city.
- [43:51]
B
Yeah.
- [43:52]
A
Does that player not only get taxed in the states, do they get taxed in the city as well?
- [43:57]
B
Yeah, so they do it somewhat in the minor leagues. So the, the, the team will source income. Most teams will source income to the state that they are their home team is in. So if you got a guy in Triple A Rochester. Who's Rochester now? The Nationals. Yeah, I think so. The Nationals may, you know, will source a majority of their income to New York. When you get to the big leagues, that's where it really changes. In the minor leagues, they're not doing road games. So, you know, AAA you may be playing. Shoot. Where are some of these teams? Non Tax State, Tennessee. Non Tax State, Sacramento. Sacramento, California. So they're not really going into that. It almost doesn't make sense for them to do it because of what the Triple A salaries are, you know, that the taxing jurisdiction doesn't really care to go after $500 for the three days that they played in Sacramento. You know what I mean? You get to the big leagues, you're now making the big league minimum, which is how much now?
- [44:59]
A
7:75, I think this year.
- [45:01]
B
That's good chunk of change.
- [45:02]
A
Yeah.
- [45:04]
B
So what the teams do, and this is actually required now, they are going to source income to the states and some cities that you are playing in. So Colorado Rockies, I have a client, I have a couple clients on the Rockies. They're playing in Colorado for 81 home games. 81 games are going to have 80, 81 games. They're going to have, you know, basically half of their salary sourced to Colorado. They go play in New York, they go play the Mets or Yankees, they're going to have that money sourced to New York based on the amount of days that they were in New York. So if they played a three game set, they were there for three games. It's a whole process of what's called the duty day schedule. The amount of days that they basically participated throughout the year for that, for that club, which includes spring training, actually. So in the sourcing of the income, the team is only going to source it throughout the season there. They do not source it for spring training. What we're able to do on the back end is basically include those spring training days and then the post season as well. So what you're doing is you're increasing the denominator while keeping the numerator the same. So you're getting a lower percentage and therefore a lower percentage should have been sourced to that state based on the amount of days that they played in total. Yeah, a little, little intricate, but basically what we do is we create a, an Excel spreadsheet of a, of where they were of their schedule. Of course, other things go into it. Were they injured, did they not travel, were they suspended? You know, a little bit rarer. But all those things factor into the duty day schedule as to where they were actually present.
- [46:58]
A
Right.
- [47:00]
B
So getting back to your original point, every team is going to source income and withhold taxes in the states that are taxing jurisdictions on that salary of whatever they're making. And they're going to come up with a number and say, hey, we think 300 grand should be sourced to New York. They'll put it on there. And then our job is to go and figure out whether the team was right or not. And that's where the fun part kind of is. And where we can get into some. Hey, you know, I got you five grand back from New York because they didn't include these days on your duty day schedule.
- [47:36]
A
Big league minimum is 780 this year.
- [47:38]
B
780.
- [47:39]
A
Yeah.
- [47:39]
B
Okay.
- [47:41]
A
All right, so let's talk about a subject that I know everybody has probably heard about and we kind of, we're touching on it a little bit right now. But let's start. Jock tax. Yeah, right. You know, we're in Pittsburgh and so yeah, this is a place that obviously people have heard of. Let's talk about where did this jock tat. Like where did this all come from?
- [48:00]
B
So it's actually, it's pretty cool. I mean, I'm wearing, I'm wearing my Jordans here right now. But in, in 1991, it basically started where the LA Lakers and Chicago Bulls were battling each other in the NBA. I mean, right.
- [48:14]
A
Michael Jordan, obviously. Why the Jordan?
- [48:17]
B
Yeah, but I mean I was so young, I don' that stuff. But anyway, what California ended up doing was saying, hey, you guys are, I think they were beating them. I mean, I don't know. But we want a share of, of this tax. You're here playing in our state. We want some of this. We want part of the pie here. So in, in 1991, the Bulls players were taxed for their time that they spent in California playing. I think next, the year after that, Illinois reciprocates. Okay. Now we got a rolling, you know, a Rolling stone here. Soon after all these states start doing it. High profile people. We know where they are.
- [48:58]
A
Yeah.
- [48:59]
B
Schedule is publicly available information. You know where they are, you see them on tv. They're here, they're earning some of their income in our state. We want a piece of it. So slowly what started happening is that all these state governments started actually codifying this stuff in their, in their tax legislation through tax legislation that we now have a jock tax. Some will say it's discriminatory, you know, but it's codified. That's where it is. We are going to tax your income when you are here in our state. Getting back to your point, some cities started jumping in Pittsburgh specifically, we're here in Pittsburgh right now. It wasn't an income tax. They started charging a 3% usage tax for basically where they were playing. And the athletes just had this 3% of whatever was sourced to, to Pennsylvania and to Pittsburgh come out of their paycheck. Athlete never saw it, went on their, you know, W2, but we couldn't do anything with it. It was just Money that was just gone. Just recently the Supreme Court of Pennsylvania found that the, that tax was discriminatory. It was not effect. It was, it was not affecting commuters. They did not have a commuter tax or anything like that. So they found it discriminatory, threw it out and it's still kind of going through the process of getting that money back for some of these clients.
- [50:33]
A
Well, and I imagine, I imagine Pittsburgh is going to appeal if they haven't already.
- [50:38]
B
Well, the Supreme Court decided. It's. It's done.
- [50:40]
A
Oh, interesting.
- [50:41]
B
It's done. Mostly the cities that have these taxes are. Are these Midwestern? I. We're not Midwestern here, but somewhat, you know, we got Cleveland, Detroit, Pittsburgh, Philadelphia, St. Louis, Kansas City. They all have city tax, but those are actual income taxes. This one they found unconstitutional because it was a usage tax and they found it discriminatory because not everyone else was subject to the tax. So a win for the athletes there.
- [51:09]
A
Interesting.
- [51:10]
B
Yeah, very interesting. And that was, that was a long drawn out process. A long. When I first started working in 2016, I think was when it was started having rumblings of this and it finally just got settled. Finally.
- [51:28]
A
So as we close here, what is some advice that you would give parents? We all love organization. Right. What is some advice you would give parents as far as things that they can do to stay organized so that when you assuming. Let's just say you were their cpa.
- [51:43]
B
Yeah.
- [51:43]
A
You have everything that you need. What are some, what are some good things for them to keep in mind?
- [51:47]
B
So the number one thing is it is organization. How do we do it? Going back to what we talk about of like getting out of wherever they are and all that stuff. If the player is going to be coming home to the house that they grew up in in the off season, have all the mail go, go there. That's first and foremost. A lot of stuff that we do is still through the mail. There's stuff that's available online, but you're still going to get that physical document there. A big thing that we just went through the past two tax seasons was the minor league settlement that we all got money from for the lawsuit against MLB that they settled. There were tax documents issued for both those years and I cannot tell you how many players just did not have it because that went to their address when they first had their signing bonus. So we're talking 10 years ago. So staying organized is getting. Just having the stuff in one place if possible for the player, access to whatever online portals that they have, writing down where you Know where they put their money if they don't have a financial advisor, if they took some of their signing bonus and gave it to their local branch to invest some of it. You know what's funny is that a lot of players, because they're playing, they forget this stuff. They're. They're focused on playing. And that's where I like to come in and take that off of them. Where we know where everything is. We know where their money is. We're not, we're not missing anything on the tax return. So it's, how can we create something? Whether it's an Excel spreadsheet of here's where my money is, where will I expect tax tax documents from? Expenses, Certain things we used to be able to deduct.
- [53:33]
A
So I want to actually, because that was my next thing that I want to ask you. Do you have or do you talk to your players about these are the things that you can reasonably deduct?
- [53:44]
B
Sure.
- [53:45]
A
And then I have a follow up question.
- [53:47]
B
Yeah. So when I first started, it was the wild, wild west of being able to deduct almost anything and everything that went into your profession.
- [53:56]
A
Right. I got dry cleaning done because I had to get my shirts for the road trip.
- [54:01]
B
And not so much that because. Yes, but the IRS would probably say.
- [54:06]
A
No, no, I get it, I get it. But plenty of people would be like, oh, yeah, no, I got questions. Right. Cleaning I'm gonna do. Yeah.
- [54:12]
B
Oh, all the time. I still get questions about that. And it's like the rule is if you can wear it out on the street, most likely not deductible. But agent fees used to be tax deductible. Clubby dues, where, you know, for someone not listening who knows what a clubby is. A clubby is a guy who basically manages a clubhouse for you. You know, just bikes. You pay them, you pay them, whatever the dues are. I think it was 20 bucks a week in the minor leagues for me. It's probably a lot more. It's probably like 50 bucks a week now. What is.
- [54:42]
A
I don't, I don't remember.
- [54:45]
B
That all used to be deductible. Now it's really working out. Bats, gloves, training equipment, all that stuff used to be deductible. Completely got rid of that under the Tax Cuts and Jobs Act. That used to be a 2% miscellaneous itemized deduction. So that in some sense has made our job easier from a preparing standpoint, where we don't have to track down all these various receipts. Various receipts and all this stuff. But for things that are legitimately still deductible, unfortunately, you know, all the training expenses, that's completely out the door. You cannot deduct training expenses off of your endorsement income. It just, it doesn't, it doesn't match, it doesn't tie up. Things that are legitimate though are. Say you make a hundred thousand dollars from an endorsement deal, well, you paid your agent 5% for that. That money is gone. That's a legitimate expense. Travel that you did for that mileage, stuff like that, those are things that you are going to want to track. Basically it's if I'm making money and I have a out of pocket expense to earn that money, most likely it's going to be deductible.
- [56:00]
A
You have a document that you provide like yes, your clients. Yeah, okay.
- [56:04]
B
Yeah, I do. And you know, again, getting back to what I was saying, it used to be huge. It used to be huge. But to, to enable the tax rates coming down, they had to get rid of some deductions on the bottom. I mean and that, that used to be a huge, huge thing. And I remember when that went into effect, planning with agents about front loading the agent fees in the tax year before it became non deductible. So there were a lot of guys who said, hey, I want to pay my agent fees for the next five years so I can deduct it right now because it's non deductible anymore. So again that's planning stuff that we go into doesn't apply anymore. But that's kind of like the idea of where we operate is how can we get creative within the law or how the law is going to change to make the best impact.
- [56:53]
A
Right now, tell everybody how they can. If they have any questions or want to reach out to you. Is there a website, an email that you want to give or just like a Instagram?
- [57:02]
B
So I don't have any of that. So all, all of this stuff that I've done has been through word of mouth, which I find really fulfilling for me. When I started this, I got, I got a great start from one of my best friends. His name is Sean Packard. I went and worked at a big sports agency who actually represented me and I learned everything I learned from him. Ended up going somewhere else and then started out on my own. Never got a website, don't do much, don't do much social media stuff. I like to do a good job. I'm thinking about doing this though. I think, I think this podcast may convince me to get this going.
- [57:41]
A
If people want to reach out to you and talk about potentially you.
- [57:45]
B
My email address.
- [57:46]
A
Okay, what is it?
- [57:47]
B
Steven S T E V E N at G P C P A S dot com.
- [57:53]
A
And we'll put that in the show notes, too.
- [57:55]
B
Yeah. And if you need to reach out to Matt.
- [57:57]
A
Yeah.
- [57:57]
B
And he's got all my info. I do a lot of stuff on my cell phone, too.
- [58:00]
A
Yeah.
- [58:00]
B
But, yeah, it's, you know, got connected with. I was. I don't want to say lucky, but I like to have really good relationships with people, really get to know them first. And then, you know, ultimately what we're doing is we're selling ourselves and. And we have a product on the back end. You know, I like the relationship part of this. Just so happens I can relate to the client a little bit more as a player. Again, I never played in the big leagues, but went through the whole process of college ball, the draft, playing the minor leagues, the grind of minor leagues, you know, didn't work out for me. It's going to work out for somebody, some. Some other people, but I want to help them navigate that process. But, you know, got hooked up with some. Some agents like yourself, some investment advisors who actually connected us. And it's been great. It's been great.
- [58:50]
A
But, you know, you've been a huge help to a handful of my clients. Yeah. And I'm sure the listener is. Is going to appreciate this advice, too. I'll leave everybody with this. As I'm sure you've gathered, it's extremely complicated stuff.
- [59:03]
B
Don't. Don't try and do it on your own.
- [59:05]
A
Yeah, exactly. Ask questions, speak to a professional. And thank you, brother.
- [59:09]
B
Yeah, thanks, man.
- [59:10]
A
Yeah.