Out of $45,000,000 Salary, Taxes Take Away Huge Chunk of Patrick Mahomes’ Historical Half a Billion Dollar Contract

Patrick Mahomes is a well-known figure in the NFL, and his lengthy contract with the Kansas City Chiefs only adds to his prominence. The deal was a major topic of conversation when the franchise secured it for him. However, with big contracts come big tax obligations, and Mahomes is no exception. He is required to pay a substantial amount to the State of Missouri, which can be a significant burden.

The Kansas City’s resident Gunslinger bagged a mega deal with the Chiefs. In 2020, he struck a 10-year arrangement with the franchise, including $141.482 million in guarantees. He would have an average annual salary of $45 Million with a $10 million signing bonus, excluding incentives and benefits. The agreement extended the remaining rookie year besides the fifth-year option. The contract’s base valuation is $477.6 million.

Taxes eat up Millions from Patrick Mahomes’ contract

Interestingly, Patrick Mahomes cannot have the entire amount, as taxes take up some amount. But in QB1’s case, the amount is insanely high. From the $45 Million gross income, $16.6 Million goes to federal tax, and $2.38 Million goes towards state tax. Moreover, the FICA takes $1.06 Million, the estimated Jock Tax is $405k, and local tax takes up $450k. It brings the total tax to $20.9 million, with the tax rate being 46.5%.

Patrick Mahomes’ deal is one trendsetter and a piece of history. It was the first half-a-billion contract in the history of sports. The Grim Reaper also proved himself worthy of the lengthy deal as he clutched the Super Bowl LVII against a dominant foe, the Philadelphia Eagles.

Read More: $9,000,000 Pay Cut by Patrick Mahomes Shows He’s Walking in Shadow of Tom Brady – EssentiallySports

With such a giant contract comes up exceedingly high cap numbers. The Chiefs need to keep it under the limits for the upcoming years. Since the franchise allowed several athletes to leave, the franchise got to maintain some cash in its treasury, and they did so too.

Chiefs restructure top franchise athlete’s contract

After coming off a Super Bowl win, the Chiefs are in the excitement zone. However, since the free agency, they lost out on several of their elite athletes on free agency. The players went to franchises where they received multi-year deals. To keep themselves as a top-tier team, the franchise had to restructure Patrick Mahomes’ contract.

Per ESPN’s Field Yates, the KC Chiefs reconstructed Mahomes’ contract after converting $12 million of the QB’s 2023 roster bonus as a signing bonus. It allowed them to create $9.6 million in cap space. The Chiefs QB1 has a $49.293 million cap hit, but the reconstruction would provide them to fill their voids for the upcoming season.

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