Aug. 19 at 12:32 AM
$BATRK $BATRA This is what Claude says: The argument for applying §162(m) to athletes is stronger today than it was when first enacted in 1993:
• A team like the Atlanta Braves is a publicly traded corporation, and shareholders bear the cost of compensation.
• A superstar player can earn far more than
$1 million, so excluding athletes creates a very visible distinction between a
$20–50 million player and a
$10–20 million CEO for no apparent reason. Why should a CEO's salary deduction be limited to
$1 million when a star player's
$50 million salary is fully deductible?
• §162(m) has evolved from a corporate-governance rule into a general policy against large corporate compensation deductions.
So, as a matter of original intent in 1993, there was a good argument athletes should be excluded. As a matter of current statutory text, there is a much weaker argument for exclusion—Congress would need to create a specific sports exemption if it wanted one!
