Roster changes from 2024

[TecnoGenius]

If there is no risk, suddenly players from those tax friendly states become in more demand, and "rich" teams can sign them because they don't have to worry about eating $SMS, they just pay out non-SMS cash if the player is injured.

You're very fixated on the advantage you think this gives rich teams, like season-ended all-star players are a common thing.  They are not, and no GM plans around having a catastrophic no-Kenny no-Schoen WR corps for 6+ games.  But look in 2024 -- there we were.

And the tax savings for high-bonus IMPs isn't as much as you think.  In most states in the USA your total tax bill might be only 30% even if you're pulling in $200k USD.  Remember, they aren't Canada!  If you get some sort of 25% tax break on bonuses, you're only saving ~8k!  (Using a total comp of $200k with a $100k bonus.)

Sure, it's a nice gravy bonus for players, but hardly a be-all-end-all.

I think players are more interested in a signing bonus as in-season injury protection as well as now-you-can't-cut-me protection.

And while saving $SMS on injured players signing bonuses sounds great, it really rarely helps teams acquire replacement talent.  What it does do is give teams end of season $SMS to be used for re-signing players.  The rich get richer.

I look at it more as rare catastrophe insurance when a team has a year like WPG 2024, with tons of top-end, bonused players getting 6G'd or season-ended.  If this happens to a team why should they be punished?  (And I'm not just playing blue-colored favorites -- law of averages would hint the next team to face this crisis won't be us -- I don't wish that level of injury on any team.)

Also, don't ignore the on-field product.  All fans in the league should receive the best product possible.  That's how we grow the fan base and get $$ in the seats and glued to the TV.

When a team is fielding their backups to backups to backups RECs like we did last season, is that good for the league?  You saw the result in our first 6 games!!  Surely there were couch-sitters, aged-out vets, or other-team PR players we could have picked up during that time, had total SMS$ not been a factor?

If you must protect teams against real-world $$ losses of 6GIR players then setup a league-wide insurance fund that all teams pay into and then 6GIR bonus money (or maybe even salary money!) gets paid out of that.  I'm sure actuaries could easily come up with the average salary and prorated-bonus league-wide every season, and the cost per team would be quite small.  Then no team has to lose out on real-$ or SMS$, and costs are predefined and budgetable for the bean counters.

[theaardvark]

You're very fixated on the advantage you think this gives rich teams, like season-ended all-star players are a common thing.  They are not, and no GM plans around having a catastrophic no-Kenny no-Schoen WR corps for 6+ games.  But look in 2024 -- there we were.

And the tax savings for high-bonus IMPs isn't as much as you think.  In most states in the USA your total tax bill might be only 30% even if you're pulling in $200k USD.  Remember, they aren't Canada!  If you get some sort of 25% tax break on bonuses, you're only saving ~8k!  (Using a total comp of $200k with a $100k bonus.)

Sure, it's a nice gravy bonus for players, but hardly a be-all-end-all.

I think players are more interested in a signing bonus as in-season injury protection as well as now-you-can't-cut-me protection.

I look at it more as rare catastrophe insurance when a team has a year like WPG 2024, with tons of top-end, bonused players getting 6G'd or season-ended.  If this happens to a team why should they be punished?  (And I'm not just playing blue-colored favorites -- law of averages would hint the next team to face this crisis won't be us -- I don't wish that level of injury on any team.)

Also, don't ignore the on-field product.  All fans in the league should receive the best product possible.  That's how we grow the fan base and get $$ in the seats and glued to the TV.

When a team is fielding their backups to backups to backups RECs like we did last season, is that good for the league?  You saw the result in our first 6 games!!  Surely there were couch-sitters, aged-out vets, or other-team PR players we could have picked up during that time, had total SMS$ not been a factor?

If you must protect teams against real-world $$ losses of 6GIR players then setup a league-wide insurance fund that all teams pay into and then 6GIR bonus money (or maybe even salary money!) gets paid out of that.  I'm sure actuaries could easily come up with the average salary and prorated-bonus league-wide every season, and the cost per team would be quite small.  Then no team has to lose out on real-$ or SMS$, and costs are predefined and budgetable for the bean counters.

Signing bonus carrots for players from favourable states are substantial, many are taxed at zero to 15%, whereas game cheques get taxed at the provincial rate where the game is, which is considerably higher.

It does guarantee money against cuts, and that is an incentive, but you can sign for a lower $SMS hit using both that fact and the lower tax rates.  My point is that if you remove all risk from signing bonuses, they will increase dramatically, and will not be good for the league overall, driving up prices.

[Blue In BC]

Signing bonus carrots for players from favourable states are substantial, many are taxed at zero to 15%, whereas game cheques get taxed at the provincial rate where the game is, which is considerably higher.

It does guarantee money against cuts, and that is an incentive, but you can sign for a lower $SMS hit using both that fact and the lower tax rates.  My point is that if you remove all risk from signing bonuses, they will increase dramatically, and will not be good for the league overall, driving up prices.

You can only spend the SMS cap. How you spend / where you spend it may change but it doesn't drive up anything. We're also speaking of a very small number of highly paid players that get significant signing bonus's combined with serious long term injury.

There is zero downside to the league.

There is more of an issue with the vagueness of the marketing money which seems to be limitless. Now there is something that could be abused and create an uneven playing field which the SMS is intended to control.

[TecnoGenius]

Signing bonus carrots for players from favourable states are substantial, many are taxed at zero to 15%, whereas game cheques get taxed at the provincial rate where the game is, which is considerably higher.

Oh, I was assuming IMPs pay taxes back home at the USA rates, not to us at provincial/federal Canada rates!  That would change the equation quite a bit.

But since most of the IMPs probably are considered 6 months + 1 day residents of USA, wouldn't they pay all taxes to USA?  I'm not sure how that works.

Maybe the signing bonus can be taxed differently since it's paid while the IMP is actually physically living/present in the USA and thus gets taxed "at home" rather than in Canada?

Yes, if for some reason IMPs are paying Canada tax while residing in Canada and USA tax in the off-season, then shifting as much of the income to the off-season and paying 30% (USA) instead of 55% (Canada) would be massively beneficial, even without some USA-specific bonus carve-out!

[Sir Blue and Gold]

Oh, I was assuming IMPs pay taxes back home at the USA rates, not to us at provincial/federal Canada rates!  That would change the equation quite a bit.

But since most of the IMPs probably are considered 6 months + 1 day residents of USA, wouldn't they pay all taxes to USA?  I'm not sure how that works.

Maybe the signing bonus can be taxed differently since it's paid while the IMP is actually physically living/present in the USA and thus gets taxed "at home" rather than in Canada?

Yes, if for some reason IMPs are paying Canada tax while residing in Canada and USA tax in the off-season, then shifting as much of the income to the off-season and paying 30% (USA) instead of 55% (Canada) would be massively beneficial, even without some USA-specific bonus carve-out!

American players still need to file their taxes in the US (even if the money is earned while in Canada) but they qualify for foreign earned income exclusions up to something like $120,000 USD. The CFL also ensures players don't exceed the 182 day rule which means Americans aren't typically considered residents of Canada for Canadian tax purposes. So many American players pay little to no US income tax as a result.