Article on Estate Planning for the International Professional Athlete
Evan Johnston (J.D. Candidate, Texas Tech University School of Law, May 2015) recently published an article entitled, Adapting to the Changing Face of American Sports: Estate Planning for the International Professional Athlete, 7 Est. Plan. & Community Prop. L.J. 339 (Fall 2014). Provided below is an excerpt from the article:
In modern times, the face of major American professional sports has changed dramatically from a national to a global enterprise. Consequently, issues facing an estate planner dealing with athletes has globalized as well. The use of real life hypothetical situations best explains the practical steps an attorney must take in order to best serve their international professional athlete client. For explanatory purposes, it is illustrative to consider two situations:
The first case is that of Shawn Bowman. Shawn is a nineteen year old ice hockey player from the farm town Lumsden, Saskatchewan, Canada, just outside of the City of Regina. Regina is one of the top producing cities of National Hockey League (NHL) players in the country. Shawn married his high school sweetheart, Jenny, and the following summer, the New York Rangers drafted him first overall in the NHL Draft. In concert with other first overall picks from previous years, Shawn signed a contract that promised to pay him a total salary of $3.75 million in his first year alone. Shawn moved to Manhattan to start his new career, purchased a nice apartment, and plans to continue to financially support his parents and their family farm back in Saskatchewan.
The second case is Nelson Smith, a dynamic twenty-five year old soccer star from Manchester, England . . . .
The purpose of this comment is to inform practitioners of the unique legal issues they may face if someone like Shawn or Nelson walks into their office. Both are noncitizens who will obtain a vast amount of money in a very short period of time, making their estate planning concerns both complex and delicate. When creating a holistic plan for an athlete, an estate planning practitioner should follow a step-by-step approach with special consideration towards the areas of: residency, tax calculation, asset beneficiary designation, life and disability insurance, and athlete image and endorsement issues.