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Richard Rider

Chargers QB Phillip Rivers has abruptly, permanently moved from California to Florida. Did state taxes play a role?


Phillip Rivers, the longtime starting quarterback for the Los Angeles Chargers, reportedly packed up his family and his belongings and moved to Florida. He announced it was a permanent move — he and his large family (nine kids and his starter wife) have left the building.

Why did he move?  We’ll get to that shortly.

Rivers is now an NFL free agent.  The move does not seem to be related to where (or IF) he will play quarterback next year.  Personally I’m hoping that he retires from active play.

I’ve always liked Rivers from afar.  Perhaps his top quality is his work ethic. It’s astonishing that he hasn’t missed an NFL game start since the took over from departing QB Drew Brees in 2006.  He’s second in the NFL in consecutive quarterback starts behind Bret Favre, a QB that he’ll never pass.

Rivers’ time as a football star has past.  Today’s QB’s have to be more mobile.  Rivers is today perhaps the NFL’s most IMMOBILE quarterback.  His only competition for that dubious honor?  Ben Roethisberger.  I give the nod to Rivers in this statuesque QB contest.

But I digress.  Let’s get back to why Rivers moved to income tax-free Florida.  He SAYS he moved to be closer to he and his wife’s family — in Alabama.   And doubtless that is true.

It is worth noting that even though his relatives and childhood friends are in Alabama, the Phillip Rivers family is moving to Florida.  Perhaps the Alabama 5% state income tax rate played a part in that decision.

Rivers didn’t mention in his announcement Florida’s income tax advantage. Smart man.

The net worth of Phillip Rivers is estimated to be about $80 million.  Assuming he makes 5% a year in income and capital gains from this net worth, that comes to $4 million.  If he stayed in CA, the amount he makes in income AND CAPITAL GAINS in excess of $1 million would be taxed at 13.3% by our rapacious Golden State.  The total annual CA income tax bill would likely be over $400K.  In Florida, it’s zero.

If he has built up capital gains over the years, it’s likely he has delayed sales until after he departed California.  Moreover, if he has deferred compensation built up, that income might also avoid California taxation.

But wait. There’s more.   While Rivers’ playing days have (hopefully) ended, he’ll likely continue to work.  He may coach football. He may be a commentator.  But given his work ethic, it does seem that he’ll continue to work in some capacity.

And then there are endorsements.  I doubt he’s much of a draw in that role, but doubtless he could pick up a few hundred thousand a year from such easy gigs.  With a good marketing agent, perhaps significantly more.

His new job would hopefully be outside California, which lowers his state taxes on that revenue.  His endorsement revenue will be taxed solely based on his state of residence — Florida.

Like every rich pro athlete in America, Phillip Rivers owes a profound debt of gratitude to a pro golfer — Phil Mickelson.  Years ago, Mickelson (a fellow San Diego County resident) “took one for the team.”  In a casual press conference, Mickelson mentioned in passing that he was thinking about leaving California for Florida — in large part because of the difference in state income taxes.

All hell broke loose.  The left-leaning media went bonkers, castigating him for his selfishness.  Many middle class duffers who looked up to Mickelson were incensed.  His many lucrative endorsement deals were in dire jeopardy.  Mickelson belatedly changed course, and to this day he and his family are still stuck in high tax California.

This adverse publicity was and is particularly important for Mickelson as he has made most of his money from endorsements, not from golf purses.  At one point, it was estimated that he made about $5 million annually from tournaments, and perhaps $60 million from endorsements.  Like Arnold Palmer and other top pro golfers, endorsements were the key to huge wealth.

What was the “Mickelson lesson” to be learned by sports stars (and entertainers in general)?  The lesson was NOT that one must stay in a high tax state.  The lesson was this:  NEVER TELL ANYONE THAT YOU ARE MOVING TO SAVE ON TAXES.

Consider Tiger Woods.  Only a couple weeks before he signed a multi-million dollar endorsement contract with Nike, Woods moved from CA to FL. He did not mention taxes as a factor.  There was zero bad publicity for him.

BTW, MOST PGA golf stars move to Florida when they are becoming successful.  When it comes to the game of golf, San Diego is a FAR superior place to live compared to Florida.  Almost no rain, mild year round weather, no bugs (especially no mosquitoes), low humidity, little wind, less racism — and few alligators on the golf courses.

Our state’s only major drawback to such rich folks is our 13.3% state income tax. But that’s enough to cause golfers and tennis stars (athletes who are not attached to a sports team) to migrate to Florida.  When Venus and Serena Williams started to shine in tennis, they quietly moved to Florida from California.  No fuss resulted.

But back to Rivers. We don’t know if taxes figured in Phillip Rivers’ decision to uproot his family (a family that lived in San Diego County for 15 years) and move them to hot, muggy, rainy, flood-prone, racist, alligator-infested Florida.  And if he’s half as smart as I think he is, we never WILL know.  Never, that is, until perhaps after he ends his days in the entertainment world and no longer profits from the endorsement markets.

The only good news in California is that our state government has a gigantic surplus — and the best shifty-eyed accountants that money can buy. We don’t need rich people’s filthy lucre.   Money grows on trees in our Golden State.