California Comptroller Malia M. Cohen wants Congress to amend the tax code to limit deferred payments, an update that could help the state get more money from Shohei Ohtani.
Cohen made the request four weeks after the two-way star and the Los Angeles Dodgers agreed to a record 10-year, $700 million contract comprising $680 million in deferred bills due between 2034 and 2043. If Ohtani doesn’t live in California by the time you receive the deferred money, you could potentially get what ultimately constitutes the source of 13. 3% of state income tax and 1. 1% of payroll taxes for state disability insurance.
“The existing tax formula allows for unlimited deferrals for those lucky enough to be in the highest tax brackets, creating a significant imbalance in the tax structure,” Cohen said Monday. “The lack of moderate limits on deferrals for the wealthiest Americans exacerbates income inequality and hinders the fair distribution of taxes. I urge Congress to take swift and decisive action to rectify this imbalance.
Cohen’s case was first reported by the Los Angeles Times.
Ohtani’s deal could save the state $98 million in taxes, according to the California Center for Employment and Economics, an app corporation that aims to provide data on task creation and economic trends.
Cohen’s driver last year. She served as president of the San Francisco Board of Supervisors in 2018 and 2019.
“Introducing limits on deductions and exemptions for high-income earners promotes social responsibility and contributes to a tax system that is just and beneficial for all,” she said. “This action would not only create a more equitable tax system, but also generate additional revenue that can be directed towards addressing pressing important social issues and fostering economic stability.”