Los Angeles Clippers Owner Steve Ballmer Could Get $1 Billion Tax Break
By Bryan Rose
Los Angeles Clippers owner Steve Ballmer could get a $1 billion dollar tax break for purchasing the NBA franchise.
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Many seemed shocked when software tycoon Steve Ballmer paid $2 billion dollars to purchase the Los Angeles Clippers from Donald Sterling, though it appears as if the businessman knew exactly what he was doing.
Ballmer, who recently suggested he wants the Clippers to become the NBA’s version of the Seattle Seahawks, could receive up to a billion dollar tax break from purchasing the franchise.
"Steve Ballmer stands to gain as much as $1bn in tax benefits as a result of his $2bn purchase of the Los Angeles Clippers basketball team, helping to explain why the Microsoft billionaire paid a record price for the club."
Not long before Steve Ballmer purchased the Los Angeles Clippers, the Milwaukee Bucks were sold for a then record price of $550 million. Months earlier the Sacramento Kings were sold for what was a record $525 million, so clearly many believed the tycoon overpaid for the Clippers despite the major market.
However the $1 billion dollar price tag now almost seems like a bargain considering Steve Ballmer could have his investment price cut in half over the next fifteen years, which is how long the tax break will take to pay itself off.
"An FT analysis of US tax laws shows that Mr Ballmer could claim about half of the purchase price in current terms over the next 15 years against his taxable income. The credits can be claimed under a little-known feature of the tax code covering so-called active owners of sports franchises."
It sounds like the tax break is available to owners of all major sports franchises so that could explain the continued skyrocketing costs in regards to purchasing a team.
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