Steinbrenner Heirs May Save Millions on Estate Tax
July 14, 2010, 7:02 am
Born on the Fourth of July, George Steinbrenner left the world stage with a great sense of timing too.
By dying in 2010, the billionaire and long-time New York Yankees owner’s wealth avoids the federal estate tax, likely saving his heirs enough money to field an entire team of Alex Rodriguezes, The Associated Press reported.
Mr. Steinbrenner’s death of a heart attack at the age of 80 Tuesday came during an unplanned year-long gap in the estate tax, the first since it was enacted in 1916. Political wrangling has stalemated efforts in Congress to replace the tax that expired in 2009.
That deprives the government of billions of dollars in annual revenue but represents an unexpected bonanza for those who inherit wealth.
”If you’re super-wealthy, it’s a good year to die,” Jack Nuckolls, an attorney and estate planner with the accounting firm BDO Seidman, told the news service. ”It really is.”
Forbes magazine has estimated Mr. Steinbrenner’s estate at $1.1 billion. The federal estate tax in 2009 was 45 percent, with the $3.5 million per-person exemption. If he had died last year, his estate could thus have faced federal taxes of almost $500 million, depending on how the estate was structured.
Mr. Steinbrenner, who had been in failing health for several years before his death, bought a declining Yankees team in 1973, promised to stay out of its daily affairs and then, in an often tumultuous reign, placed his formidable stamp on 7 World Series championship teams, 11 pennant winners and a sporting world powerhouse valued at perhaps $1.6 billion.
A pioneer of modern sports ownership, Mr. Steinbrenner started the wave of high spending for players when free agency arrived, and he continued to spend freely through the Yankees’ revival in the late ’70s and early ’80s, the long stretch without a pennant and then renewed triumphs under Joe Torre as manager and General Manager Brian Cashman.
The Yankees’ approximately $210 million payroll in 2009 dwarfed all others in baseball, and the team paid out millions in luxury tax and revenue-sharing with small-market teams.
Even in death, the "Evil Empire" wins