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Tax increases could factor in MLB negotiations

Tax increases could factor in MLB negotiations

Team executives and agents wandered into the Agave Sunset lounge at the resort where the general managers' meetings were held in Indian Wells, Calif. Four of the six flat-screen televisions were showing election coverage, with the other two turned to sports.

President Barack Obama's victory over Mitt Romney was of as much interest to baseball's money men as the game scores, given the millions of dollars routinely guaranteed in player contracts these days.

As free agents negotiate deals this offseason, tax policy is an area that comes up along with the usual issues. Some players are wrangling for as much money as they can get before the end of the year to avoid a take hike in 2013.

``Front-loading would make sense if at all possible as tax rates will definitely go up on January 1st on all high-income taxpayers,'' agent Greg Genske said in an email. ``The only question is HOW MUCH will the rates increase????''

This much is known for now: Starting Jan. 1, there is an additional 0.9 percent Medicare tax on wages above $200,000 for individuals and $250,000 for married couples filing jointly under the federal Affordable Care Act, a rise to 2.35 percent.

In addition, the Bush tax cuts are scheduled to expire at the end of the year, which could raise the highest marginal federal tax rate from 35 percent to 39.6 percent - although a deal between Obama and Congress could change that.

Oakland Athletics general manager Billy Beane figures agents will be on top of the changes - but the results of negotiations about the so-called fiscal cliff are unpredictable.

``I think if you're hopping around the potential of tax reform, you're probably chasing your tail,'' Beane said. ``If they can predict when something's going to happen, then they're much further ahead than the lawmakers.''

With baseball contracts worth as much as $275 million (Alex Rodriguez) and the major league minimum $480,000, tax policy affects every player who spends most of the season in the big leagues.

All-Star shortstop Jose Reyes, who has a $10 million salary next year, was traded from the Miami Marlins to the Toronto Blue Jays. While Florida has no state income tax, Reyes remains a New York resident from his days with the Mets and had high taxes to begin with. Ontario's provincial tax rises to 11.16 percent - on top of a Canadian federal level as high as 29 percent.

Among states with big league teams, income tax rates go as high as 10.3 percent in California and 8.82 percent in New York. At the other end, Florida, Texas and Washington have no state income tax. The top rate in the District of Columbia is 8.95 percent.

``I like ours; we're a no-tax state,'' Seattle Mariners general manager Jack Zdurienck said. ``When we sit down with players, that's a huge benefit. I think any player out there that has an opportunity to play in a no-tax state gets benefits, enormous benefits. We hope that weighs in our favor.''

According to an analysis done by a tax lawyer on the staff of agent Scott Boras, a player with a $10 million salary and average deductions who plays in Florida and is a resident of that state will see his taxes rise from $3.45 million this year to $4.09 million next year under current law. If traded to the Blue Jays, that player's 2013 tax would rise to $4.27 million. And if dealt to a California team, the tax would go up to $4.4 million.

By moving money from salary into signing bonuses, players can sometimes lower their state tax bills. Shifting money into December this year could reduce federal taxes.

``Tax measures are going to be discussed, but change most likely carries compromise on both sides,'' Boras said. ``One thing is clear based on the nation's ballot totals: Many Americans are split on this subject.''

In the end, most free agents choose teams based on where they want to play, not on lowering the tax cut on their income.

``It's a factor, maybe even a small factor,'' agent Craig Landis said. ``If there's 50 variables, you can now make it a 51st. It's not usually going to be the drive, but it's something to consider.''

And for teams, only the big spenders need worry.

Beane's Athletics, for instance, had the lowest payroll in the majors last season.

``It's probably not a situation I'll have to face in Oakland too much,'' he said.

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Report suggests Barack Obama is trying to recruit Masai Ujiri to Wizards

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Report suggests Barack Obama is trying to recruit Masai Ujiri to Wizards

The Wizards are reportedly preparing to make Raptors president of basketball operations Masai Ujiri a massive offer to run Washington's NBA franchise. And they may have some big-time help recruiting him to D.C. 

Barack Obama, the 44th President of the United States, is trying to persuade Ujiri to leave the NBA champions to join the Wizards, according to The Athletic's Ethan Strauss. 

"I hear Barack Obama's a part of that whole Masai recruitment to D.C.," Strauss said on a recent episode of the "Back To Back" podcast. "I've heard Obama wants Masai in D.C. Obama wants to do something with basketball."

Obama and Ujiri are close friends. Obama was in attendance at Game 2 of the NBA Finals in Toronto, while Ujiri attended the White House Correspondents' Dinner in 2015 when Obama was in office. 

The Wizards' potential offer for Ujiri is reportedly for six years, $60 million, and could possibly include an ownership stake in Monumental Sports & Entertainment and other responsibilities within the company, sources have told NBC Sports Washington. 

And hey, it doesn't hurt to have the former Commander in Chief making your sales pitch.

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Sekou Doumbouya visits Wizards hoping to sell them on his defense

Sekou Doumbouya visits Wizards hoping to sell them on his defense

WASHINGTON -- The Wizards hosted one of their final prospect workouts in anticipation of the June 20 NBA Draft on Friday, as six players battled in three-on-three drills with every member of Washington's front office and coaching staff in sight. But behind the glass wall of the dining lounge at the Wizards' practice facility at St. Elizabeth's was the player everyone wanted to see.

Sekou Doumbouya, who is projected to land in the lottery on draft night, made a visit to Washington to speak with Wizards personnel. He did not participate in the workout, but through face-to-face interviews gave the Wizards an up-close look at a player who may or may not be on the board when they are on the clock with the ninth overall pick.

Doumbouya is the youngest player in the draft at just 18 years old, with his birthday not until late December. He is originally from Guinea but played professional basketball in France. Given his age and the fact he played in a second-tier league before making the leap to the NBA, Doumbouya holds some mystery as a prospect.

In his meetings with teams, Doumbouya has tried to hammer home one point in particular.

"My defense," he said. "I can play everywhere [because] if you play defense, you can play everywhere in the league."

Defense certainly stands out when it comes to Doumbouya's potential. He is 6-foot-9 with a reported 7-foot-2 wingspan. At his age, he could keep growing. And at that size, he has the mobility to guard multiple positions, force turnovers and maybe even block some shots.

The Wizards need help with just about every area of their defense. They were 27th in defensive rating last season and 29th in points allowed. They couldn't defend the perimeter or the lane, allowing the fourth-highest three-point percentage (37%) and the fifth-most three-point makes (12.1/g), while also allowing more field goals within five feet of the rim than any team (22.1/g) and the third-highest percentage (64.2%) in that range. 

Doumbouya projects as the type of defensive anchor who could help in a variety of ways. He could step out to guard three-point shooters while also clogging lanes to the basket with his length.

The questions for Doumbouya center around how NBA-ready he is at his age and experience, and what his ceiling will ultimately be on the offensive end. Doumbouya, though, believes he can be especially effective in transition.

"Fastbreak," he said when listing his strengths. "I love running [the floor]."

Whether Doumbouya will be available at the ninth pick depends on who you ask. Most mock drafts have him at nine or lower, but his athleticism and versatility could entice a team that picks before the Wizards.

The Hawks, whom Doumbouya met with the day after seeing the Wizards, are a team to watch. They have the eighth, 10th and 17th picks in the first round, so they can afford to take a risk. They could snag Doumbouya at No. 8, then go with a safer pick or two with their other selections.

But there is a very good chance Doumbouya is the best player available when the Wizards get set to make their pick. If he does, defense will be his biggest selling point.

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