• The Yankee Tax Man Cometh

    Posted by on December 21st, 2009 · Comments (5)

    Via the AP -

    Winning came with a hefty price for the New York Yankees.

    The World Series champions were hit with a luxury tax of nearly $25.69 million Monday, according to information received by clubs and obtained by The Associated Press.

    New York is the only team to pay a tax for this season and has crossed the threshold in all seven years since the tax started. According to the collective bargaining agreement, the Yankees must send a check to the commissioner’s office by Jan. 31.

    The Yankees have been billed $174 million of the tax’s $190 million total since 2003. The only other teams to pay have been Boston ($13.9 million for 2004-7), Detroit ($1.3 million for 2008) and the Los Angeles Angels ($927,059 for 2004).

    At least the Yankees got value for their spending, winning the World Series for the first time since 2000 after adding high-priced free agents CC Sabathia, A.J. Burnett and Mark Teixeira. And the Yankees did lower their tax bill from $26.86 million last year, when their streak of consecutive playoff appearances ended at 13.

    New York’s payroll was $226.2 million for the purpose of the luxury tax and the Yankees pay at a 40 percent rate for the amount over $162 million. To compute the payroll, Major League Baseball uses the average annual values of contracts for players on 40-man rosters and adds benefits.

    The Yankees’ regular payroll — using 2009 salaries and prorated shares of signing bonuses — finished at $220 million. That was a drop of $2.5 million from 2008 but more than $77.8 million higher than any other team — a gap larger than the payrolls of the bottom 11 clubs.

    If the Yankees ever have a team payroll under $162 million with Brian Cashman as their G.M., I’ll…ooooh…shoot…I’ll post a picture of myself on this blog holding up a sign that says “Brian Cashman, You’re The Best G.M. In Baseball History.” How’s that?

    Comments on The Yankee Tax Man Cometh

    1. December 22nd, 2009 | 1:32 am

      Yet u want to add more payroll with D Lowe trade… doesnt compute

    2. Evan3457
      December 22nd, 2009 | 1:44 am

      What if that $162 million payroll allows them to finish…4th?

    3. December 22nd, 2009 | 9:10 am

      srivinodh wrote:

      Yet u want to add more payroll with D Lowe trade… doesnt compute

      I’ve covered this about…ooooh…a hundred times in comments already…but…hey…maybe #101 will stick? ;-)

      Do I want the Yankees to have a G.M. who is astute enough to win without having to spend $200+ million on team payroll and by out-spending the next closest team in baseball by more than $70 million (!) dollars in team salary? Yes, I want that with all my heart.

      Do I live in that world? No, I live in Cashman Purgatory. So, if I’m forced to live under these conditions, I must adapt if I want the Yankees to win – which, I do, again, with all my heart. Therefore, if I must have Cashman as the GM, and I want the Yankees to win, then I realize that they will spend, spend, spend…because that’s the only way “Team Cashman” can win.

      It’s the difference between knowing what you want and living with what you got. Does that compute? ;-)

    4. MJ
      December 22nd, 2009 | 9:39 am

      Steve Lombardi wrote:

      Do I want the Yankees to have a G.M. who is astute enough to win without having to spend $200+ million on team payroll and by out-spending the next closest team in baseball by more than $70 million (!) dollars in team salary? Yes, I want that with all my heart.

      I never understood why you — or anyone else — cared about this.

      The 2007 World Champion Red Sox outspent their NL World Series counterpart the Colorado Rockies by $88,602,214.

      The 2008 World Champion Philadelphia Phillies outspent their AL World Series counterpart the Tampa Bay Rays by $43,820,597.

      The 2009 World Champion Yankees outspent their NL World Series counterpart the Philadelphia Phillies by $88,445,143.

      Just accept that baseball doesn’t have a salary cap and that teams spend money unevenly. There is nothing more noble or legitimate about the ’08 Phillies title than the ’07 or ’09 titles won by the Red Sox and Yankees, respectively.

    5. YankCrank
      December 22nd, 2009 | 10:11 am

      Steve Lombardi wrote:

      Do I want the Yankees to have a G.M. who is astute enough to win without having to spend $200+ million on team payroll and by out-spending the next closest team in baseball by more than $70 million (!) dollars in team salary? Yes, I want that with all my heart.

      Well don’t hold your breath, because it doesn’t matter who the Yankee GM is. If it’s Brian Cashman or somebody else, they will be spending $200 million because the Yankees have that financial advantage and are an organization that takes advantage of everything they can. The Yankees were exploiting free agency all the way back when it started, they continue to and it won’t stop until the rules prohibit it.

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