Wall Street Journal op-ed, Albert Pujols’s Capital Opportunity, by Fay Vincent:

Why aren’t sports stars beating the tax man by demanding ownership stakes as part of their compensation, as executives do?

It’s often said the key to getting rich in our society is to figure out how to convert ordinary income, taxed heavily, into capital gains income, taxed at a much lower rate.

So I was surprised when the three basketball superstars LeBron James, Chris Bosh and Dwyane Wade joined together earlier this year to negotiate as a unit and then make their unique deal to play for the Miami Heat without getting any ownership—or capital—in the franchise. Clearly their agreement to play for the Heat made the team much more valuable. In my view, they missed a golden opportunity. …

My question is why sports figures are not taking steps to generate tax-favored income by bargaining to get ownership interests in their teams. … IIf modern stars are smart they will soon begin to emulate highly paid business executives and improve greatly their compensation by adopting more sophisticated tax planning. In the business and entertainment worlds, top executives and talent do not work exclusively for salaries. They want and get a piece of the action. They want to create and own assets, defer income and control their tax exposure. …

Mr. Pujols will in all likelihood negotiate a salary of around $35 million annually in a four- or five-year agreement. He and his agent will surely notice the enormous bite the tax collectors will take of that income. Why not take some of the pay in the form of a piece of the Cardinals franchise? Who would argue the Cardinals are not more valuable if they can keep him?