Love him or hate him, Steinbrenner just wanted to win — at any cost. The Yankees have the highest payroll of any team, thanks to his need to land the biggest free agents in the game at the most exorbitant salaries. I remember when they gave Bernie Williams (one of my favorites) a seven-year deal worth $87.5 million, at the time making him the highest-paid player in the major leagues.
And who could forget the hirings — and firings? As a kid coming of age in the 1980s, I loved seeing whether or not Billy Martin would be back for another year — or if he would even MAKE it through the season (not once, actually).
Steinbrenner even had the audacity to “win” in a financial sense by kicking the bucket in 2010, rather than in 2011 — making his heirs very, very happy. Why? Because according to MSN Money, they will save $600 million in estate taxes.
How It Happened
The most recent estate tax (a rate of 45% on inheritances valued at more than $1 million) put into law under President George W. Bush expired at the end of 2009, and the new 55% (!) tax doesn’t go into effect until Jan. 1 of next year. Which means anyone dying in 2010 can leave 100% of their assets to their heirs. Steinbrenner is estimated to have been worth $1.1 billion, well over the $3.5 million exemption threshold.
However, Congress can choose to come up with a new version of the estate tax bill, perhaps raising the exemption to $5 million and lowering the percentage of inheritance assets lost to taxes.
In theory, dying with $3.5 million in assets isn’t too shabby (for your heirs, obviously, not for you, who would no longer be roaming the Earth). But if you’re running a small business (a retail store, a farm, etc.) and the government comes and takes 55% of that from your estate if you die next year, your family likely will have to sell the business. Or, if it’s property that makes up the majority of the estate, the homes would likely have to be sold.
George Steinbrenner died this week, and still managed to come out a winner.