Republican Tax Bill Carries Poison Pill That Could Kill Minnesota Twins Sale

[Peter Labuza]

Image courtesy of © Jack Gruber-USA TODAY via Imagn Images

Since January, many Americans have felt the transformation of various structures and functions under the second Donald Trump administration. However, the new omnibus tax bill currently making its way through Congress introduces a new wrinkle that will particularly upset Minnesota Twins fans; it could end up killing the sale of the team.

President Trump’s signature legislative plan, the so-called “One Big Beautiful Bill Act,” has passed the House and arrived at the Senate. The bill, which runs over 1,000 pages, generally comes down to broad tax cuts for the top earners in America by raising taxes on the poorest, alongside cutting 13.7 million Americans off health insurance. Radically sweeping in scope, the bill includes a ban on any regulation of artificial intelligence, neuters the judiciary’s power to limit abuses by the executive branch, and removes the requirement for citizens to register gun silencers. The bill projects to increase the federal deficit by $4.6 trillion over the next decade.

Most of the bill heavily favors the ultra-wealthy, but right where the Pohlad family needs a break most, it might bite them hardest. Specifically, the bill includes a dangerous poison pill for new sports owners and their tax bills.

Buried on page 966 of the bill is a “Limitation on Amortization of Certain Sports Franchises.” The clause replaces language in the current tax code, reducing “the adjusted basis” of various team assets from 100% to “50 percent.” As the New York Times reports, those assets “include player contracts, media rights and sponsorships … Under the House plan, team owners would be able to deduct from their taxes only half the value of those intangible assets over that period.” To put it plainly, many teams would be accepting a much higher bill than any cuts they might get. While the White House has claimed this is to punish owners for “overcharging ticketholders,” it is difficult to see why owners would respond to the situation by reducing prices. 

Don’t cry for the owners, of course, but any current sports group will not be hit with the bill. Only new owners of teams purchased after the passage of the bill will feel the brunt. It's a difference of, depending on the situation, tens or scores of millions in tax breaks lost. Not even billionaires can take such a hit without their eyes watering a bit.

That would likely have a chilling effect on the market for teams across every league, leaving most current owners—whether John Fisher of the Athletics or Jerry Reinsdorf of the White Sox—in place for another decade. New owners would probably want a discount on a sale, as they must spend extra years recovering their costs, something that the Pohlads have been unwilling to do. Unless the Pohlads are dead set on selling, the bill would likely keep them as owners for the foreseeable future; it would certainly prevent them from getting the kind of price they've sought thus far. 

Because the sale of teams is a long and thorny process, the idea that the Pohlads could “rush” a transaction is far-fetched. When the Baltimore Orioles sale occurred last year, the timeline was slow:

• January 30th: ESPN Reports Sale of Orioles
• March 27th: MLB Owners Approve of Sale
• August 1st: Sale Finalized. 

The Pohlads could cut through as much red tape as possible to ensure a sale, but it seems unlikely. Trump has suggested the bill should be on his desk before the July 4 holiday, and selling before that would be an extraordinary feat, given where things appear to stand now. The best chance to find ownership will likely rely on MLB agreeing to ownership from abroad by those willing to overspend, which would most likely “sportswashing” ownership from the Middle East. For decades, foreign ownership has been bandied about, but the league has always treated it as anathema, and that's unlikely to change now.

Because of the danger of the bill, NFL owners have already spent time lobbying various senators, where the bill is currently being debated. The politics of the One Big Beautiful Bill Act have been complicated even within the Republican Party, from those hoping to ensure Americans have access to Medicare to those who wish to see the bill’s enormous deficit cost reduced. The sports ownership clause could well be amended in the Senate before returning the bill to the House for reconciliation. The major leagues (MLB included) will surely lobby heavily for that outcome, but how effective that advocacy will be is hard to guess.

If it does pass, one might call it poetic justice. After all, Trump had a higher bid than Carl Pohlad to buy the team in the 1980s. But for fans, this is a rare moment where helping billionaires might actually be the best move. If the Act were to pass in its current form, the Pohlads and Twins fans could be stuck with each other for a long while.

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[Trov]

Interesting part of the bill that no one has really talked about that I have seen, until here.  I agree, not sure how taking money away from owners would cause them to want to reduce ticket prices.  I think it they are really trying to do is decrease the contracts players are getting because owners will now have to tell the players well we are now paying more in taxes and the money we used to pay you cut against our taxes, so to make up for that we either need to raise ticket prices or pay you less. 

If that part of the bill is finalized by Senate all the next CBA's will be very interesting. 

[DJL44]

Looks like some Senators are attempting to extort bribes from billionaire sports team owners.

[Whitey333]

Not surprised about this .  The Trump regime and it's radical right agenda is founded on lies, false facts, and hopes and dreams.  Much like the Twins season.  Pohlads are going to have to come down in price and pay off their own debt if the are really serious about selling the team.

[mnfireman]

Politics on a sports forum, against the forum's own rule's, interesting. Let's see how long it takes before comments get shut off...

[Rod Carews Birthday]

6 minutes ago, mnfireman said:

Politics on a sports forum, against the forum's own rule's, interesting. Let's see how long it takes before comments get shut off...

The bill, if passed and signed, would represent a major change in how teams are valued and taxed.  That means that selling the Twins would be even more messy (maybe even impossible) than it is right now, which greatly affects something that many (probably most) fans want to happen, the sale of the team. 

Yes, it's politics.  But also yes, it belongs on this site because it affects something integral to what this site is about.  If a tax bill put a $10 fee on every ticket sold, I would expect to see that here as well.   I also hate politics on non-political sites, but the effect would likely be direct and deadly. 

[Patzky]

11 minutes ago, mnfireman said:

Politics on a sports forum, against the forum's own rule's, interesting. Let's see how long it takes before comments get shut off...

The impacts are real. 💁

[LA Vikes Fan]

This is a very interesting wrinkle in the sales process. We were discussing that in another thread so thanks for raising it here as a single issue. It really effects the economics of owning a sports team, particularly a sports team like the Twins that loses money on a cash on cash basis now that the regional sports network revenue spigot has been turned off. Those two factors together probably drop the value of a team like the Twins by 15-20%. Without the TV revenue or tax deduction it really will be very difficult to make money on the Twins if you run any sort of competitive payroll. So either the TV situation needs to be resolved so teams like the Twins get $50m plus a year like they used to get, or the only the truly "I don't care if I make money I just want to win" type billionaire will have a lot of interest in the team. You don't get to be a billionaire without real business acumen (or inherited wealth), so those type of billionaires are few and far between.

The other potential problem is this may increase the number of franchises that come up for sale in the near future. I have to believe that the owners of teams like Cleveland, Miami, Tampa, and probably others find that a tax deduction that can be used to shield other income is a strong inducement to maintain ownership. If that goes away, why not sell?

Bottom line, the Pohlads may need to move this along even if it means taking a couple hundred million dollars less than they would have gotten last year. Don't be like people who list their house in a down market and refused to sell because it was worth more three years ago and they can't believe they're not going to get that price. All of the warning lights are now blinking so if you want out, get out now.

[Rod Carews Birthday]

1 minute ago, mnfireman said:

Then the author needs to drop the first two paragraph's, they have nothing to do with sports or the sale of the team and are merely a reflection of his personal views.

Point taken, but paragraph two (the one that is the most controversial) is probably necessary to really clue people in to exactly what bill we are talking about.  Otherwise, it would be lost out there ("buried on page 966") and people wouldn't realize what to pay attention to.  Bills like that (on both sides of the aisle) pass all the time and it is only after the fact that people realize what has happened (when it is too late).  Without an article like this, I would probably not have known that this was out there.  Now I do, and I'm glad the article was written. 

[Fire Dan Gladden]

6 minutes ago, mnfireman said:

Then the author needs to drop the first two paragraph's, they have nothing to do with sports or the sale of the team and are merely a reflection of his personal views.

Sorry, but it is actually the whole tone of the article.

I agree that this is newsworthy on a site like this this, but it isn't written in a politically neutral format.

[Rod Carews Birthday]

11 minutes ago, Fire Dan Gladden said:

Sorry, but it is actually the whole tone of the article.

I agree that this is newsworthy on a site like this this, but it isn't written in a politically neutral format.

I'm not sure in the current times that there is such a thing as a politically neutral format.  Such is the nature of the beast.  Unfortunately there are always triggers out there for people (on both sides) that prevent them from looking past the chaff and into the real information.  It's the world we live in.

[twinstalker]

I was appalled before we even got to the punch line.

[IronMonkee]

32 minutes ago, Fire Dan Gladden said:

Sorry, but it is actually the whole tone of the article.

I agree that this is newsworthy on a site like this this, but it isn't written in a politically neutral format.

Absurd stance. There is no way to be accurate about what these clowns are doing without presenting it as negative. Insisting that it be presented neutrally is insisting that it not be presented at all.

[Squirrel]

1 hour ago, mnfireman said:

Politics on a sports forum, against the forum's own rule's, interesting. Let's see how long it takes before comments get shut off...

If the comments are limited to this one portion of this bill, it’s relevant and discussion will continue. But if comments start getting off track, become personal, etc, comments will be removed and or shut off. Consider this a warning for all. Stick to the topic.

[NYCTK]

5 minutes ago, Squirrel said:

If the comments are limited to this one portion of this bill, it’s relevant and discussion will continue. But if comments start getting off track, become personal, etc, comments will be removed and or shut off. Consider this a warning for all. Stick to the topic.

I understand the reason why and don't blame you for this at all. But there is also a certain level of cowardice in this sort of moderation as well, and it has helped this country get to the extreme polarization we now see. 

Unfortunately there is often a sad lack of respect when this sort of conversation is broached which is why I understand the reasoning for this level of moderation, but these sort of conversations SHOULD be held respectfully in everyday life. Instead we all go off to our echo chambers with our alternate realities and learn to hate each other even more. 

 

[Squirrel]

9 hours ago, NYCTK said:

I understand the reason why and don't blame you for this at all. But there is also a certain level of cowardice in this sort of moderation as well, and it has helped this country get to the extreme polarization we now see. 

Unfortunately there is often a sad lack of respect when this sort of conversation is broached which is why I understand the reasoning for this level of moderation, but these sort of conversations SHOULD be held respectfully in everyday life. Instead we all go off to our echo chambers with our alternate realities and learn to hate each other even more. 

 

I don’t disagree, but, this is a baseball website. After years of doing this it’s the only way we have been able to manage things without it becoming a free for all. In the beginning of this site it was one free for all after another. The owners wanted to close the forums. So, this is where we are. If people wouldn’t take or make things personal, we could actually have a discussion, but name calling comes out, dubious sourced arguments come out, and it resorts to nothing good. No one listens to ‘the other side’ as they are already deemed radical. Everyone insists that they are the only right opinion. There ends up being a lack of nuance and real critical thought. So … it gets shut down as it lacks anything substantive and lacks respect, which is a founding principle.

[mnfireman]

10 minutes ago, NYCTK said:

I understand the reason why and don't blame you for this at all. But there is also a certain level of cowardice in this sort of moderation as well, and it has helped this country get to the extreme polarization we now see. 

Unfortunately there is often a sad lack of respect when this sort of conversation is broached which is why I understand the reasoning for this level of moderation, but these sort of conversations SHOULD be held respectfully in everyday life. Instead we all go off to our echo chambers with our alternate realities and learn to hate each other even more. 

 

 

28 minutes ago, NYCTK said:

MAGA loves politics infecting everything so much there is literally MAGA specific sports sites. They've turned massive sports loser Clay Travis into a political thought leader. Not to mention some loser swimmer that tied for 5th in some collegiate swimming event is now a hero of MAGA because, as it turns out, they love making sports political. 

 

I can see the type of respect you are talking about in this statement. 

The portion of bill concerning sports franchises and its effect on sale of teams, potential new owners and fan bases could possibly be debated, but the rest of the bill should not be discussed on a forum such as this, no matter which side you agree with.

[NYCTK]

1 minute ago, Squirrel said:

I don’t disagree, but, this is a baseball website. After years of doing this it’s the only way we have been able to manage things without it becoming a free for all. If people wouldn’t take or make things personal, we could actually have a discussion, but name calling comes out, dubious sourced arguments come out, and it resorts to nothing good. No one listens to ‘the other side’ as they are already deemed radical. There ends up being a lack or nuance and real critical thought. So … it gets shut down as it lacks anything substantive and lacks respect, which is a founding principle.

I get it. The anonymity of the internet turns off something in people's brains and allows them to say things they would never say to the other person if they were in front of them. Myself included. I even edited a comment immediately after posting it in this very thread because I found myself doing exactly that. 

[NYCTK]

1 minute ago, mnfireman said:

 

I can see the type of respect you are talking about in this statement. 

The portion of bill concerning sports franchises and its effect on sale of teams, potential new owners and fan bases could possibly be debated, but the rest of the bill should not be discussed on a forum such as this, no matter which side you agree with.

Not quite. I would absolutely call Clay Travis and Riley Gaines massive losers to their faces because they are, in fact, massive losers. 

And it is simply a fact that both of those losers have been elevated to a high status in the MAGA media world based on the lies they spread and the narratives they feed. 

[Major League Ready]

There are several articles detailing the tax breaks given to sports teams if anyone wants a summary of the tax breaks, just google it.  (see one example below) I can't imagine anyone here would feel bad about owners losing "bonus depreciation" which includes player contracts, goodwill, media contracts.  Keep in mind these expenses are deducted from revenue to determine taxable income.  Then, they get a bonus deduction.   It's simply not fair.    

Tax Breaks for Sports Teams

 

[Craig Arko]

My guess would be if a sale becomes untenable (which I read as the point of this article) the Pohlads would run the team into the ground, extracting whatever they can to prop up their real estate businesses. Then when MLB comes along offering contraction again, they take it.

[Western SD Fan]

President Trump’s signature legislative plan, the so-called “One Big Beautiful Bill Act,” has passed the House and arrived at the Senate. The bill, which runs over 1,000 pages, generally comes down to broad tax cuts for the top earners in America by raising taxes on the poorest, alongside cutting 13.7 million Americans off health insurance. Radically sweeping in scope, the bill includes a ban on any regulation of artificial intelligence, neuters the judiciary’s power to limit abuses by the executive branch, and removes the requirement for citizens to register gun silencers. The bill projects to increase the federal deficit by $4.6 trillion over the next decade.

Most of the bill heavily favors the ultra-wealthy, but right where the Pohlad family needs a break most, it might bite them hardest. Specifically, the bill includes a dangerous poison pill for new sports owners and their tax bills.

There.  Fixed the article.  Gives the reader the reference to the legislation they need and why it's important to us as readers of a non-political baseball forum.

Now to discuss the actual implications of this part of the bill.  Agree with the previous posters who have suggested that this will be huge as part of the next CBA, will do nothing in terms of cutting ticket prices, and will likely affect the negotiations of the sale of the franchise.  One thing this article does not address is the timing of this piece of the bill.  Is this bill effective in 2025 or 2026? We likely won't know until it is actually passed as this type of language almost always changes during this part of the process.   If the law affects tax year 2025, then it doesn't matter when the bill is passed vs when the team is sold as the owners (whether new or old) will have to deal with the effects of the bill, unless Congress gets really nuts and has an effective date during the 2025 year (happened before in tax legislation) thus splitting the year into two sets of laws.  If this law is effective starting in 2026, a new owner could potentially create a corporate year for the Twins that starts in 2025 but extends into 2026 and still get to use the old law for one year, which may soften the sting of this legislation for the first year.  That gives the potential sale a chance to get to October or November to be finalized.  I'm not a CPA, a tax lawyer, or a lawyer in general so take this with the authority it deserves.

[Rod Carews Birthday]

24 minutes ago, Craig Arko said:

My guess would be if a sale becomes untenable (which I read as the point of this article) the Pohlads would run the team into the ground, extracting whatever they can to prop up their real estate businesses. Then when MLB comes along offering contraction again, they take it.

THIS is exactly the point that is important to Twins fans specifically right now.  Politics is just politics and there will always be disagreements, but sometimes we have to let things pass and not be offended by everything the other side says.  

SHORT ANSWER:  Let’s get this team sold RIGHT NOW!!!!

[arby58]

2 hours ago, Fire Dan Gladden said:

Sorry, but it is actually the whole tone of the article.

I agree that this is newsworthy on a site like this this, but it isn't written in a politically neutral format.

If the author were to drop the first sentence of paragraph one, the second sentence of paragraph two and then combine those paragraphs, then drop the first sentence of paragraph three, a lot of the 'loaded' nature of the political commentary would be neutralized. I'm a Democrat but still found those sentences, in this forum, to be unnecessary.

[Craig Arko]

59 minutes ago, Rod Carews Birthday said:

SHORT ANSWER:  Let’s get this team sold RIGHT NOW!!!!

And how would we go about doing that?

[TwinsDr2021]

2 hours ago, NYCTK said:

Not quite. I would absolutely call Clay Travis and Riley Gaines massive losers to their faces because they are, in fact, massive losers. 

And it is simply a fact that both of those losers have been elevated to a high status in the MAGA media world based on the lies they spread and the narratives they feed. 

and what do these two and MAGA media have to do with the bill or the Twins sale?

I tend to agree with Major league Ready - " Keep in mind these expenses are deducted from revenue to determine taxable income.  Then, they get a bonus deduction.   It's simply not fair. "

I will add two things, if this was passed in the last budget the people not liking it would be OK with it and the other side would be against it 

And like others have said most of this article could have been left out and basically said on page 966 of the the bill being debated the bill reads a “Limitation on Amortization of Certain Sports Franchises.” The clause replaces language in the current tax code, reducing “the adjusted basis” of various team assets from 100% to “50 percent.” As the New York Times reports, those assets “include player contracts, media rights and sponsorships … Under the House plan, team owners would be able to deduct from their taxes only half the value of those intangible assets over that period.” To put it plainly, many teams would be accepting a much higher bill than any cuts they might get.

This could affect the sale of the twins what are you thoughts on the ramifications of this?

[Craig Arko]

3 minutes ago, Western SD Fan said:

The saddest part of this article is that the discussion has shifted to how the article was written, the political ideologies of the author, and very little substance of what the article was trying to give to us readers.  Given the importance of what this could mean to the future of the Twins, fifteen minutes of editing would have made all the difference and kept the comments to the subject matter of the story.

Or, the people doing the commenting driving this narrative could have taken a moment to think about the implications. 

[Patzky]

2 hours ago, mnfireman said:

 

I can see the type of respect you are talking about in this statement. 

The portion of bill concerning sports franchises and its effect on sale of teams, potential new owners and fan bases could possibly be debated, but the rest of the bill should not be discussed on a forum such as this, no matter which side you agree with.

This is taking on a life of its own faster than a Kody Funderburk 8th inning meltdown

 

[Cory Engelhardt]

Just now, Patzky said:

This is taking on a life of its own faster than a Kody Funderburk 8th inning meltdown

 

Long ways to go to get to the famed Brian Dozier rumored trade to the Dodgers thread back in the day though :)

[Patzky]

1 minute ago, Cory Engelhardt said:

Long ways to go to get to the famed Brian Dozier rumored trade to the Dodgers thread back in the day though :)

I was but a cardboard hero back then.