Just saw this Running back Ricky Williams not absolved of $8M debt to Miami Dolphins -- South Florida Sun-Sentinel.com
Its not B.S. He did it to himself by walking away. And its also his fault for doing his own contract without an agent, that's the first thing they would have looked to erase.
agreed. i am not saying im happy that ricky still owes the money to the team, but this should of been issue number one when he was working on the deal he just signed... as far as i know, he might of tried to work on a deal about the money owed. the reality is that he still owes the money.
Yeah, I saw this on Profootball Talk but they also went into detail on the site about how it was better for both sides to keep this in the air. It talked about cap hits/gains and taxes so if your interested go read that article. Just FYI
My take on the matter is if Williams plays hard and finishes out his career in Miami with no more shenanigans or failed drug tests, Miami never goes after that money. Otherwise, it's fair game. I wonder if there is an unwritten agreement somewhere in all this. But Ricky should have gotten it in writing.
I like this dual standard we have going on here. If it were any other avenue in life the 8.1mil would be expected to be paid in full. The dude diverted from his contract. It's not hard to understand why superstars in the US begin to feel like they are above the law, when we as fans treat them as such.
But if you read the update I'm not sure that's accurate. First RW already paid taxes on this money. He wouldn't have to pay it again. And the cap guy they spoke to told them it wouldn't count against the cap.
This is one theory on the situation... http://www.profootballtalk.com/2008/09/10/ricky-still-owes-the-dolphins-81-million/ "If the Dolphins were to formally forgive a portion of the debt, the forgiven amount would count against the salary cap. More importantly for Williams, he most likely would have to treat the transaction as income, and pay taxes on it. So if the Fins were to simply tell Williams right now that all is forgiven and forgotten, the Fins would have to show the $8.1 million against the 2008 cap, and Ricky would have to send a check to Uncle Sam somewhere in the neighborhood of $2.5 million. (As some readers have pointed out, Williams would be entitled to a refund of his taxes if he pays back the money, since he already has paid taxes on the amounts that the Fins would be receiving. Nevertheless, the portion of the debt that he owes over and above any potential tax credit would still constitute income. So the check would be smaller than $2.5 million, but he’d still have to write one, and it wouldn’t be for $29.95.) Our guess, then, is that the Dolphins will likely allow this thing to remain pending indefinitely, and never attempt to collect it. Ricky would never be able to pay it off, but he also would have a very hard time settling up with the tax man if the Fins ever tell him he won’t have to".
i said it was bs because other players who retire in training camp are never forced to pay back 8 million dollars in bonuses. the lions never came after barry sanders, cheifs willie roaf, etc.
My guess, as some have also thought, is that even tho the debt isn't absolved, his performance in the coming year will go a long way towards resolving the issue in the future...but it makes sense for the organization not to make such a disclaimer to push Ricky towards honoring the remainder of his contract. Once the debt is 'paid'...the pressure would be off him to continue to play and perform...
PFT is obviously not well versed in taxes. Ricky has already paid income taxes on the $8.1M. Lets further assume, for sake of simplicity, Ricky has a flat tax rate of 35% (ignoring the marginal tax brackets for now). That would be $2.835M to uncle sam (ignore states right now). Ok, if Miami were to "forgive" his debt he would be entitled to a refund of taxes paid on income he had to give back but then he'd owe taxes on this newly acquired income (forgiveness of debt), which happens to be the same amount. So in the end, all else being equal, the tax bill would be exactly the same. The IRS as wicked as they are, will not try to collect double income tax on the same income. They would lose in court if they tried, it would be so inequitable.
for anybody interested, and not sure if it has been posted, but ricky thinks he wont have to pay debt back: Ricky Williams: I assume I don't have to repay Dolphins -- South Florida Sun-Sentinel.com
I honestly thought that the trigger for annulment was completion of his contract. That would have been the end of this season.
