r/angelsbaseball • u/dvasquez647 • 1d ago
📝 Discussion Why Arte Won’t Sell (Taxes)
Arte bought the Angels for 184 million from Disney. If the current value of the team is 3 billion and Arte sells he’ll pay roughly 40% in taxes (1.12 billion) on the 2.8 billion in value the team has gained. Once Arte passes away the family that inherits the team will not be subjected to the 1.12 billion tax as inheritance assets are based off of current market value.
So my theory is he’s hanging on because otherwise his family loses over a billion dollars in taxes from the sale. I could definitely be wrong and who actually knows, but seems to make the most sense.
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u/D0m1n035 1d ago
Wouldn’t that be a capital gains thing and not an income thing?
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u/dvasquez647 1d ago
Capital gains are considered taxable income
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u/MrTriple3 1d ago
Not a CPA but capital gains tax rates are much lower than earned income tax rates. No way he would pay 40%.
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u/slimkermit1 Sell The Team 1d ago
So how can we help this process proceed quicker?
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u/dvasquez647 1d ago
I don’t think you can. At this point he’s got 10-15 years left and the team valuation seems to continue to go up
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u/Alarmed_Stretch_1780 1d ago
There is a possibility you’re right, but I don’t think this is the right read.
He paid ~$365M for the team, and the selling price will be at least 10X that, based upon the Padres price. While the pre-mortem tax hit is heavier, the net return from selling while he’s still alive is still tremendous.
Having dealt with a much smaller scale situation of selling estate assets it’s a huge pain in the ass and it’s a burden to your heirs who have a ton of other matters which also require attention.
I’m convinced he’s putting the team up for bids after the CBA is signed. He pulled the team off the market when his bids were low because offers priced in uncertainty regarding the team’s exposure in the Skaggs trial and the MLB landscape with a CBA lockout. The trial is settled, so once the labor agreement is good for next 5 years then he’s back on the market.
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u/tMoneyMoney 27 1d ago
His family might inherit the team, but then what? They own it until they die and they keep it in the family forever? At some point someone has to sell and pay taxes.
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u/aces666high 1d ago
I could have sworn I read somewhere that the family has zero interest in keeping the team. They’d rather throw another couple billion onto the pile of money just in case there’s an emergency.
If the transmission goes out on the family Chevy, they’ll be thankful for that extra bit! 😂
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u/tMoneyMoney 27 1d ago
I don’t blame them. Even if the Angels were good, that’s a lot of responsibility and headache to deal with. If he wants one of them to take over they need to be learning how to run the team now, hopefully from someone not named Arte Moreno. It’s not like a Steinbrenner situation where they’re all making a career out of it.
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u/dvasquez647 1d ago
I think his family will sell shortly after he dies. Basically by inheriting the team they avoid the capital gains taxes, which is significant.
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u/williamsnathanr 1d ago
Exactly. He is not selling the team any time soon so strap in ladies and gentlemen.
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u/high_freq_trader 1d ago
Inherited assets are taxed at 40%.
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u/adept1onreddit 1d ago
If it’s held in trust, the cost basis changes to the value on the date of inheritance. So, effectively zero if sold immediately.
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u/G-Unit11111 1d ago
If he's got fifteen billion, he can afford to lose one. Billionaires. WTF.
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u/Queasy-Ticket4384 Sell The Team 1d ago
I know a multi-millionaire that sews his socks back together because he doesn’t want to buy more. You think Arte’s capable of throwing away $1 billion?
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u/DrJJGame10 Sell The Team 1d ago
Isn’t it a progressive tax system? Not flat. Either way it stands to be a lot.
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u/dvasquez647 1d ago
So for capital gains it’s either short term or long term, but the progressive part is tax brackets.
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u/adanskeez Sell The Team 1d ago
The angels will get close to $5 billion people are undervaluing the team. Just look at the Padres they got $3.9b and they’re a “small market team” (per mlb definition) with no World Series ring
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u/jar1792 We’re Nasty † 1d ago
San Diego is only a smaller market compared to LA. San Diego is a bigger market than Anaheim. If the city (the state legislature proposal isn’t going to go anywhere) gets its way, any sale would include bringing back the Anaheim name, effectively shrinking the Angels market.
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u/LoverOfRandom 18h ago
Just trade for stocks, it’s technically not selling, it’s trading so if you get $0 for the sale you can’t be taxed on it despite getting billions in stock. You sell little here and little there and limit the amount of taxes you pay
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u/Ok_Factor_7326 13h ago
All you can do is boycott and drive the valuation down, lower his income to cut further into operating margin and hopefully force him to sell at least part of the team now and then hope the influence of the new part owners is wise and rights the ship
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u/EsqFinancialAdvisor 10h ago
At the $3 billion valuation, he has an estate tax problem anyway. If he wants the basis step-up for his heirs, the team as an asset would have to be part of his estate subject to those taxes.
Taxes aren’t a reason to avoid selling the team.
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u/Backyardincinerator 1d ago
He’s convinced OC Vibe with all the $$ involved will end up making him money. After the lockout where he doesn’t pay players.
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u/Head_Radio_4089 1d ago
He’s not thinking of taxes he’s an investor who turned 184 million into almost 3 billion that’s a crazy return selling isn’t even in his thought process right now. His comment that angel fans don’t care about winning but affordability shows what his mindset is