Bifalgorithm post

Why do billionaires buy sports teams that lose money every year? Tom owns a company that makes $20 million. The government wants $8 million in taxes. Tom refuses to pay. So he buys a professional basketball team. But the team is terrible. It loses $1 million a year. Normal people think Tom made a stupid investment. But Tom is smart. He didn't buy the team to make a profit. He bought it for a secret tax loophole. When you buy a factory, the government lets you deduct the cost of the machines as they wear down. But a sports team doesn't have machines. It has athletes. Thanks to a completely insane tax law, Tom can legally claim that these players lose value every year, just like factory equipment. That's what's called "workforce amortization". This creates a huge loss invisible on paper. Tom takes this fake loss from the basketball team and uses it to legally erase the real profits of his main company. His huge tax bill instantly drops to $0. He can sit courtside in his own arena. The team may lose on the court, but Tom earns $1 million.

Why do billionaires buy sports teams that lose money every year? Tom owns a company that makes $20 million. The government wants $8 million in taxes. Tom refus…