Quote:
Originally Posted by Enoch Root
Semantics. It very much does go beyond 8 years, as he is paid until 2045.
Yes, lots of people have deferred comp arrangements. Those people don't work within a salary cap structure.
|
No he is deferring his comp which is earned over the term of the contract.
If the Flames took $1 million of the amount owed to Huberdeau this year, and put it in an institutional class bond fund that he could begin to draw from in10 years would you be arguing they extended the term of his contract.
Because that is all that is happening here. His cap hit stays the same, the cash outflow stays the same. The player benefits from lower taxes in the future (lower marginal federal bracket, potentially lower state taxes, no social security or fica taxes). It’s a great deal for anyone whose earnings are likely to fall off a cliff and want to be tax efficient. Usually you have to leave your money in the deferred comp vehicle for at least 5 years for tax reasons.
I see zero salary cap issues with a player deferring his pay.