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Speaker 1: We're gonna talk stats in this segment. We're gonna welcome
in our.
Speaker 3: Tax mort wealth advisor or a certified financial Planner NFLPA
Certified Financial Planner Blaine Anderson and this segments brought to
you by Banterwealth bantererwelth dot com. Get on that free
Q and A no obligation to invest Q and A
with our tax smart wealth advisors. Today, let's talk stats
with Blaine Anderson. Blaine, how the heck are you?
Speaker 2: I'm doing great. Merry Christmas, Ben.
Speaker 3: Merry Christmas, Happy holidays. Appreciate you joining us. I have
a question for you. I know, we we we We're
gonna go into a number of different topics here today,
but I've been evaluating recently the Puka Nakua situation. Right,
Pooka's balling out last night. He had himself a night.
Puka Nakua is arguably the best wide receiver in the NFL.
The crazy thing about this, Okay, he is on his
rookie deal. It's a four year deal worth four point
one million dollars with the Los Angeles Rams. I think
you probably know a little bit about California and how
they tax you know, people and uh, you know the
income tax, Etceterably, half of that is going to to
federal in state Texas. So he's maybe taken home, what
four hundred and eighty thousand something like that. What would
you guess to make there after all the taxes that
he's having to pay.
Speaker 2: Yeah, I wouldn't be surprised at all. He's at least
thirty seven percent marginal bracket, and then the state of
California is another ten percent. So yeah, he's probably seeing
net about half of that.
Speaker 3: Okay, so we see in half half of that. So
it begs the question. He was a fifth rounder at
a brig up fifth round pick, one hundred and seventy
seventh overall. Obviously he never saw the practice squad. The
practice squad players make like two forty, right, and sometimes
they may be called up to the fifty three man.
They'll get a little pay raise, but their minimum is
essentially to forty. It begs the question, do you take
a rookie minimum contract?
Speaker 1: Say, for instance L. J.
Speaker 3: Martin, he's a fifth sixth seventh rounder, Say he doesn't
get a grade A Day two draft rade, and so
that puts them probably in that bracket of these these
rookie deals that are a million dollars a year roughly. Okay,
depending on where you're drafted, right, it's gonna determine how
much tax you're gonna pay. These are things you've discussed
with some of the players that you represent, the people
that you represent. Is it better than to stay in
college represent.
Speaker 1: A place like BYU.
Speaker 3: Let's say you make I don't know, seven hundred and
fifty k, or let's say you make a million, but
you're a W nine for that year as an independent
Contractor what's the better thing to do. Is it to
take that rookie minimum contract you're and take the chance
of where you're getting drafted and the taxes that are
associated with that, or do you take a seven hundred
and fifty k W nine or one hundred of one
million dollar W nine instead?
Speaker 1: What would you say?
Speaker 2: Yeah, well, I think more than ever this is a
complicated decision and even something worth debate. Years ago, of
course it wasn't even a question. But like for example,
talking to LJ when he was on the show and
joined me for one of these segments recently, he talked
about it being a dream of his going to the NFL.
I can understand that it's tough to place the value
on it, but if you get down to just the numbers,
being a big fish in a small pond, and I
know BYU feels like a big pond to us that
are here local, but in the grand scheme of things,
it's a small pond, and a player like LJ is
a big fish. And now where they could make the
kind of money that they can and do at seven
hundred and fifty thousand dollars range versus going to the
NFL and have making a couple hundred thousand. But if
you go to a state like California or Massachusetts, New York,
you're going to pay a lot in state taxes. Now Florida, Arizona, Nevada,
some of these other states where there's not a state
income tax might make a difference. But the bottom line
is I would say, unless you're a first or second
round pick, I would be tempted to play and stay
my senior year. And I think hopefully that does keep
guys like LJ. Martin if they can put off going
after their goal, which was the pleatly professional. From a
number standpoint, I think a great argument can be made
that third round and below staying enjoying some of the
benefits of nil from the dollar standpoint, make a lot
of sense. The only thing I would throw out that
maybe the NFL guys have even more than the college guys,
could be more of the endorsements and some of the
brand deals and the other things that they do. I mean,
we do see Pooka doing a lot with Little Caesars,
for one. I know I've seen him on some other commercials.
I bet he's making more there than he is even
with his NFL contracts.
Speaker 3: No, that's intriguing, But you have to be a Pukah, right,
I mean, he's that's right, you know what I mean.
You have to become a Pooka by year three on
that rookie contract. You got to be balling out. You
have to be one of the premier players either in
the market you're in, right, You're gonna get market deals,
right if you're in LA. I mean that helps him, right,
because he's a because he's in a big market. You
go to a smaller market you made, you're gonna have
to go local deals rather than maybe national deals. So
that's an of intrigue, Like when when does it benefit?
What's the threshold? Right do you think Let's say a
practice squad guy. Okay, say a guy has an eligibility
left and he could come back and make you know,
five hundred thousand as an independent contractor, or even two
hundred let's say it's two hundred and fifty thousand as
an IC or. He goes to the NFL and he's
probably a practice squad guy making that same rate, but
he's having to pay taxes on it immediately. What's the
better route there if you're kind of that practice squad guy,
but you can make you know two hundred thousand or
so in college football?
Speaker 2: Yeah, Well, as an NFLPA advisor, we we've done a
number of webinars, and especially around the combine and the
rookie camps, we were involved in a number of trainings
around the rookie contracts, the practice squad contracts. And I'll
tell you, based on what I saw, I would rather
be a big fish in a small pond to have
a senior year at a college with the opportunity to
participate in revenue share in NIL. Then I would practice
squad NFL guy.
Speaker 1: Yeah, yeah, I'm right there.
Speaker 3: And you can take an insurance contract out right, So
if you're coming back, you're going to get an insurance
type of policy to protect.
Speaker 1: Your right if you do get injured that final season.
Speaker 2: Correct, absolutely absolutely, and a lot of guys do that
they're expensive, but that does give a little bit of protection.
I think a lot of it is something I'll remember
that LJ said, and that was just that playing in
the NFL was part of his dream and I'm sure
that's a big factor with it all. But if you
have some of that perspective and you know your outcome
or at least where you're at. You mentioned some of
these NFL guys that may have a year of eligibility
that to me, I would rather take a year of
college and now with the opportunity to earn money. It's
a whole different landscape and a whole different decision.
Speaker 3: So as a as, like, let's say i'm a I'm
a student athlete here, I'm an athlete student with a
I create an LLC. I'm gonna have a million dollars
coming in this year with my deal.
Speaker 1: You meet with CPAs all the time.
Speaker 3: And you you have these these forums where you're you're
representing your client and they have their CPA there. What
are some of the tax mart WELP things that you
can do in that year to maybe offset some of
your tax exposure. If you're bringing in seven hundred and
fifty to a million dollars and fifty thousand to a
million dollars in a year.
Speaker 2: Yeah, Well, like you mentioned, when you have an LLC
or a business entity set up, we'll go and set
up a retirement plan with that business entity, and especially
if you have very employees, we even set up pension plans.
They're called defined benefit plans or cash balance plans. They're
way more advanced and way more opportunity than like a
four to h one K. But that's a way to
put a lot of that money that you received now
into a tax deductible, tax deferred account and an investment account.
We do other types of investments we've talked about, whether
they be oil and gas or even in real estate.
Start creating passive income. So having that business LLC or
entity having a ten ninety nine income put in together
a tax smart wealth strategy, especially where that income's going
to flow. It's going to be heavy in some years,
maybe not others. There's some wonderful planning that can be done.
We even put together a playbook for business owners for
ten ninety nine high income earners, and it's part of
our tax Smart playbook, and it's one specifically for business owners.
There's a lot you can do with that type of
setup and arrangement.
Speaker 1: Yeah. Now, great insight there.
Speaker 3: Blaine Anderson Financial Advisor, tax our Wealth Advisor here on
your Utah ESPN.
Speaker 1: Ready to network.
Speaker 3: There's a lot of players in college football right now
going through this process and trying to figure out what
the best route is for them.
Speaker 1: A couple other things there.
Speaker 3: New year is on the rise of some entrepreneurs will
want to think about strategically, you know, their income flow,
when and how they take income from their businesses in
the coming year to stay as tax efficient without maybe
limiting growth. Can you share a few insights, maybe a
few strategies around income flow that they might consider right now.
Speaker 2: Yeah. Just in the call prior to us stopping on today,
I was talking to an investor out of Colorado. We
had done a tax observations analysis for him and realized
that he had about eighty thousand dollars of realize capital
gains that he could still play with before the end
of the year. So he's looked at his portfolio, figured
out where we could sell some investments, free up some
cash flow, keep them in a fifteen percent law term
capital gains bracket, not push him over the net investment tax,
which is an additional, unnecessary three point eight percent, and
keep him out of the short term bracket. So what
we were able to do is free up eighty thousand
dollars in cash, save him ten percent on these transactions
in the sale. And that was just by some planning
and doing a tax observations and analysis. For many of
our business owners, we tell them, hey, let's pay some
of these costs that we know you're going to have
in January now, and let's take some of that income
that we know is coming in January and push it
off to next year. It's a little bit about timing
and management, and yes, we may run into similar situations
next year. But I just had a meeting with an
accountant this week and I heard him say something to
his client that I really liked, and he said, paying
taxes later is always better than doing it now. That
was something that came from him, and that's part of
the deferral strategy and some of the timing that we
help them implement with clients at the end of the year.
Speaker 3: Love that great breakdown and Blaine always appreciate our time together.
Speaker 1: Always love talking stats with you.
Speaker 3: For those that are wanted to maybe hop on a
feet free Q and a no LO the caase doing
best Q and A at the end of the year.
Speaker 1: What's the best way to go about doing that.
Speaker 2: Yeah, on our website on the contact us, we have
a section where you can request a copy of our
tax Smart Playbook and that'll give you some ideas. I
actually was just with on a call earlier this week
with a caller that had got a copy of our
playbook and cited three or four strategies that he wasn't
aware of. He scheduled a call. I met with him yesterday.
We're going to hop on again early next week. I'm
going to do a tax observations analysis for him so
he can get some ideas at the end of the year.
But the call really is meant to be about you,
as as a client or as a listener, understand a
few things that are happening in your personal world, and
then give you maybe some blind spots or some options
and strategies. But you can schedule that call with one
of the members of our advisory team, a certified incial planner,
and you can do so at Vanderwealth dot Com. We've
got some good options and have really enjoyed our conversations
with listeners.
Speaker 1: Thank you, appreciate you.
Speaker 3: Blaine Anderson Bantererwealth Banterwealth dot Com. We'll catch up with
you again soon. Ladies and gentlemen, are live from the
Road Home. Tis the season to be giving, and those
that are in most need along the watch that's front
are here at the road Home. Last year, the Road
Home server eight thousand people, including two thousand children. Ninety
percent of those placed in housing, they remain house.
Speaker 1: So call them.
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Speaker 1: Uh, what would you do? Ronnie?
Speaker 3: You know you gonna you would you take that fifth
sixth seventh round spot with a you know, a four year,
four point one million dollars a rookie deal. I think
that's what Lj's up against right now. He probably is
gonna be a fifty three man roster guy fifth sixth
seventh round. He's gonna be on that traditional rookie deal
because he's not gonna be.
Speaker 1: A day to guy.
Speaker 3: He could make anywhere from seven hundred and fifty to
If he went into the portal, he'd probably get more
than that. He'd probably hit one point five million on
the free market. It's probably gonna be somewhere in between there.
What do you do and why? We'll discuss it on
the flip. This is Cougar Sports on one oh three
nine ninety eight point three ESPN