It was just revealed that Floyd “Money” Mayweather owes the IRS related to his taxable income for 2015. The amount he owes was not disclosed, but 2015 was the year he made approximately $220 million for his fight with Manny Pacquiao and another $32 million for fighting Andre Berto later that year. The highest taxable rate is 39.6% plus interest for lateness. Realistically that amount would be lower after Floyd deducts the amounts owed to Al Haymon, Leonard Ellerbe and any other write offs you are still looking at roughly $200 Million in taxable income and a federal tax liability of approximately $80 million. Floyd has come out saying he already paid $26 million to the IRS for 2015. This means one of two things: either his taxable income was significantly lower than the estimated $200 million or he vastly underpaid his taxes for the year.
While the amount he actually owes the IRS for 2015 was not disclosed, Mayweather appealed for an extension for 2 months citing illiquidity in order to pay off the outstanding debt. The translation: Mayweather has significant assets but not necessarily the cash on hand to pay his tab and needs the income from his August 26 bout to cover his debt. Floyd may be far from actually broke today, but all indicators reveal the count may be on.
I am neither a Floyd fan nor detractor. I love seeing anyone rise to the top of the profession and prosper. I respect his skills as one of the greatest defensive fighters ever. I also respect his self promotional abilities in a business where fighters are mostly a disposable commodity, often left with little to show for their efforts after their careers have ended. Floyd’s Showtime deal was unprecedented and he has undeniably made a ton of money throughout his career. While “Money” is his persona and we know it costs to floss, the notification from the IRS appears to be the first warning that Floyd may become yet another cautionary tale of celebrity wealth gained and eventually lost.
It is almost unfathomable to most of us as to how someone can blow through nine figures/ aka hundreds of millions. Floyd has made nearly a half billion in his career (if not more) and the fact that he could be experiencing any kind of financial tightness is beyond most of our scope. Floyd, of course, has come out and denied that there is any serious issue and claims his empire is intact. I hope he is right. Yet, IRS debt is usually a first indicator that not all is completely well.
Floyd has all of the trappings of wealth. Several multi-milllion dollar properties including mansions in Las Vegas and Miami Beach. a fleet of luxury cars, jewelry, a large entourage, security team, use of private planes. I have never seen Floyd’s tax return’s or his accountant’s balance sheets, but these luxuries are indeed costly not just for their initial purchases, but in the upkeep and maintenance. The mansions, which he claims to have paid in cash are indeed assets. Perhaps they will go up in value, perhaps not. The taxes and maintenance on properties like Floyd’s can easily reach a quarter million or more per year (each). Floyd’s car’s are also an asset in that he paid cash for them. However, while he may have a few that maintain their value because of their exclusivity, the majority of his cars (like all of ours) are depreciating assets each year. The same are true for jewelry and clothes.
Entourages and security teams do not come cheap. Floyd has a large payroll, and for all intent and purposes this upcoming fight with Conor McGregor will probably be his last big payday. Though I hope not and wish him the best, Floyd does not appear poised to make the transaction to keep up his present lifestyle once boxing is officially done. Most fighters are not, with Oscar De La Hoya’s Golden Boy Promotions being one of the exceptions to the rule.
Again, without knowing what Floyd actually owes the IRS it is hard to say how much of his upcoming purse will be eaten up by old debt, but remember even a one hundred million dollar payday means that nearly $40 million of that is spoken for just for the current taxes. That leaves sixty million for the old debt. I do not know how liquid Floyd presently is, but after the past and present taxes (depending on what is owed) he could easily see less than $10 million after taxes (old and current) on a $100 million dollar purse.
That’s still a lot of money, but Floyd will have to take stock of all future spending, because he will probably never have another big purse to bail him out again. A bonus fact: Floyd is a gambler. We know when he wins and that he bets really big at times because he shares those facts. What we do not know is how often he gambles or how much he loses. Unless his luck is different than 99% of the people that bet regularly, Floyd loses more than he wins. The level of his betting and any losses could be a contributing factor in future monetary issues for Floyd.
Far be it for me to tell another person how to spend their money. I just hope that this IRS situation for Floyd is enough of a warning to curb some of his spending in preparation for a future that will most likely not include big fighting purses. We all know and get that he is “Money” Mayweather. Yet, the persona only has any meaning if he can avoid going broke. I really do wish him the best… unfortunately many of the signs toward future financial instability are there. Hopefully this is a warning he can heed and recover from.
If you enjoyed this piece, be sure to read others in diaryofamadmind.com
#IRS, #FloydMayweather, #MoneyMayweather, #MayweatherMcGregor, #ConorMcGregor
