As the first round of the 2018 NFL Draft was proceeding, Bolles School product Hayden Hurst got excited after he received a phone call from someone he trusted who told him the Jaguars were targeting him with the No. 29 overall pick.

Hurst wanted to play for his hometown team, which desperately needed an impact tight end. Though Hurst — then the oldest first-round draft pick at 24 — was happy when the Baltimore Ravens took him four slots before the Jaguars, he also knew in advance of the financial consequences that most rookies don’t notice.

Since Florida is one of four NFL states (Tennessee, Texas and Washington being the others) with no state income tax, Hurst, who played at South Carolina, understood he’d see a big chunk of his $6.1 million signing bonus disappear on the deduction line when he received his first bonus check.

“Honestly, throughout the entire draft process, that [paycheck deduction] was on my mind because I always paid attention to state income tax percentages,” said Hurst, who went through a similar experience after the former pitcher was drafted in the first round of the 2012 MLB Draft by the Pittsburgh Pirates and received a $400,000 signing bonus.

“I thought about how much of my money was going to be impacted depending on which state I played in," Hurst said. "I’m paying a pretty hefty percent up in Maryland. To see the amount get taken away right off the bat kind of hurt, it was pretty sickening.”

With the NFL free agent market set to open Wednesday, Hurst’s situation illustrates a potential competitive advantage for the Jaguars of being in an income tax-free state when they court free agents.

Considering 25 teams play in states that impose an income tax, the Jaguars have come to realize being in Florida offers financial benefits to players that they can exploit in free agency.

“I didn’t think about it in the whole free agency aspect when we were first building a team,” said general manager Dave Caldwell, entering his seventh season in Jacksonville. “But as we’ve started to sign guys and talk it over with agents, it’s become more of a focal point.”

Hurst understands it all too well. That’s because getting drafted by the Ravens turned out to be a bigger hit than he first suspected. On top of Maryland’s 5.75 percent state income tax for those earning at least $250,000, Baltimore County also has a 2.95 percent income tax. So in 2018, Hurst saw approximately $575,000 taken out for state/locality taxes, which doesn’t include the $2.4 million-plus deducted for the 37 percent federal income tax on top earners.

Since NFL players, as well those playing MLB and NBA, also get taxed for playing road games in states with income taxes, Hurst paid taxes on all 16 games last season. Even in the road game against the Tennessee Titans (a no income tax state), tax law requires his Maryland tax be applied if it’s higher than the state of the Ravens’ road venue.

While Hurst’s tax situation puts him at a disadvantage, it did benefit Jaguars’ first-round pick and University of Florida defensive tackle Taven Bryan. Besides playing in a state with no income tax, Jaguars players are not taxed for road games against Tennessee or the Houston Texans, giving three AFC South teams at least 10 tax-free games per season.

“Taven Bryan got picked behind me and I’d guess he maybe cleared more [net income] than I did,” said Hurst.

That would be accurate. Though Hurst grossed $6,586,201 in 2018 with his combined signing bonus and rookie salary — compared to $5,945,424 for Bryan — the Maryland/Baltimore taxes added up to a much bigger bite out of his paychecks. Hurst’s take-home pay last year was actually about $175,000 less than the player drafted four spots after him, according to his financial planner, George Greco of Mariner Wealth Advisors.

Greco, whose company has Hurst and about 80 other NFL clients, says it’s an unavoidable consequence for players who have to pay state income taxes. MWA is used by many NFL agents to break down how taxes impact player contracts.

“In this case, more money [for Hurst] meant less money,” said Greco. “Still, it’s a good problem to have because he’s still making a good living.”

By Greco’s estimation, even though his client will earn $240,292 (according to industry website spotrac.com) more than Bryan in base salary over the next three seasons, his take-home pay will be somewhere around $200,000 less because of the tax differences between Maryland and Florida.

“Things like that give the Jaguars a much better place in free agency,” Greco said. “Their salary cap is much better than for teams in California, New York and New Jersey.”

As former Jaguars linebacker Paul Posluszny said: “Everybody sees what flashes [for contract numbers] on the ticker of ESPN. Those aren’t actual take-home dollars.”

Hurst added that as a general rule, “You can cut it about in half.”

Big contract vs. net income

During his eight seasons (1999-2006) with the Jaguars, few players were better plugged in to NFL business than tight end Kyle Brady. A Penn State graduate, he was the Jaguars’ union representative, and the Atlantic Beach resident is now an attorney specializing in real estate law, as well as a financial planner.

Former teammates often came to Brady for advice on money matters, sometimes when it involved impending free agency.

“If players don’t think about [tax implications], they ought to be,” Brady said. “I do know this: When I was playing, players thought about it more when they were in their late 20s or early 30s.

“They’ll say, ‘My agent thinks I can get X amount of money on the open market with a certain team.’ Well, are you thinking about how much heavier a tax burden you’ll have going to those places?”

Posluszny signed with the Jaguars from the Buffalo Bills in July 2011, right after an NFL lockout, so he had little time to continue shopping his services with a six-year, $45 million contract on the table and training camp starting.

The income tax savings of going from New York to Florida didn’t even dawn on him until he saw his first bonus check.

“You immediately noticed it,” Posluszny said. “I had forgotten about that. So that was nice.”

When the Jaguars made Brady the league’s highest-paid tight end in history with a 5-year, $14.5 million deal in 1999, he fully realized the financial benefits of leaving the New York Jets — and New Jersey’s traditionally higher income tax rates — for Jacksonville.

Before cashing either of his two installment checks of a Jaguars’ signing bonus that totaled $4 million, he had someone from the team take him to the Department of Motor Vehicles to establish a Florida residency. That way, Brady made sure his bonus checks wouldn’t be subject to New Jersey state income tax.

With free agency on the horizon, Brady insists the front offices of the Jaguars, Miami Dolphins and Tampa Bay Buccaneers should play the no-state-income-tax card when competing in the annual NFL auction.

“If I’m a GM of the Florida teams or in a state with no income tax or a lower state tax, once the agent decides to raise the point of what other contract offers are from teams, that should be a point of legitimate conversation,” Brady said. “It’s not just what you make [in gross salary], it’s what you take home.”

One organization that will see a huge bump in take-home pay once they finally move to Las Vegas, likely in 2020, are employees of the Oakland Raiders. Players now paying a nation-high 13.3 percent in California state income tax will have no state income tax in Nevada.

Imagine the extra money quarterback Derek Carr would pocket in that scenario. If Carr plays under the 2020 salary of his current contract, which is $18.9 million, that means he would save $2,513,700 in state income tax playing in Las Vegas.

Most parties involved in NFL contract negotiations from both sides of the table believe that in free agency, the first priorities for players are how they fit with a particular team and the guaranteed money. But nobody dismisses the income tax factor because those are hidden dollars seldom highlighted.

“If you had two or three offers and everything being equal, I think [being in a no-income-tax state] is definitely a consideration,” said Jacksonville-based agent Paul Healy, who has represented Seattle Seahawks kicker Sebastian Janikowski for two decades.

That’s not the only math playing out in the Jaguars’ favor. Caldwell, after signing 39 of 44 players during the opening week of free agency in the past six years, has learned there are other built-in advantages to make Jacksonville a destination spot.

“I paid attention to [Florida’s no-income tax] when I chose Jacksonville over the Jets [for a GM position],” Caldwell said. “Don’t forget the cost of living factor, too. Jacksonville has to be one of the cheapest in the league, if not, the lowest. My cost of living went down when I came here [from the Atlanta Falcons].

“People don’t realize what a great city Jacksonville is. I was one of them. But now that I’ve lived here, I know.”

Cashing in with Jaguars

When the official free-agent courtship process starts Monday, the expectation is the Jaguars will be chasing after quarterback Nick Foles faster than anybody.

The big question seems to be less about whether the Jaguars will sign Foles, but at what price?

You can count on Caldwell bringing up to Foles’ agent, David Dunn, about Florida being a no-income tax state. The Jaguars know it’s an important asset, especially if a quarterback-needy team such as the New York Giants has any plans to court Foles. Obviously, the same tax advantage for the Jaguars wouldn’t hold up if the Miami Dolphins decide to get involved with Foles.

For example, let’s say the Jaguars and Giants were willing to offer Foles around a three-year, $60 million contract, including a $16 million signing bonus and a $6 million salary for 2019.

If Foles comes to Jacksonville, he would only be subject to the 37 percent federal income tax, plus a pro-rated tax for six Jaguars’ road games, including pricier deductions for playing in California against the Oakland Raiders and Los Angeles Chargers.

However, that same offer with the Giants would include a New Jersey state income tax of 8.97 percent. That means Foles, in comparison to paying nothing in Florida, would see approximately $1,973,400 deducted for New Jersey taxes from his first-year income of $22 million.

Going into free agency, Greco says the amount of knowledge each player has about financial matters varies on a case-by-case basis. Many sign with teams without even taking a visit.

“The client will determine the level of involvement he wants [in free agency],” Greco said. “Some players just want the biggest deal they can get, even if it’s less dollars in the bank after taxes.

“It comes down to trusting the agent. A good agent will make his client aware of the tax implications.”

Caldwell added: “Agents get paid off the contract’s total worth. The agent who does the right thing will look out for the player who gets more in his check.”

With quarterback Blake Bortles expected to be released and defensive tackle Malik Jackson already gone, that leaves Andrew Norwell and Calais Campbell as the Jaguars' biggest beneficiaries of being in a no-income-tax state.

Last March, Norwell — after earning just under $4.3 million in four years with Carolina as an undrafted free agent — spurned the Giants to sign a five-year, $66.5 million contract in Jacksonville. He says he had no clue at the time of the tax savings, though he admits now his Miami-based agent, Drew Rosenhaus, probably mentioned it during the courting process without Norwell paying much attention.

“The signing happened really quick with no visit,” Norwell said. “I was so excited to get down here. I don’t think [no state income tax] played a factor in my situation. I was just looking into what was the best fit and opportunity for me.”

As Norwell learned, it turned out to be a nice fit for his bank account. Had he signed the same deal with the Giants, as many predicted before free agency began, he would have seen $1,524,900 deducted from his 2018 income of $17 million ($15 million signing bonus, $2 million salary), based on the New Jersey state income tax of 8.97 percent.

“My family was telling me congratulations, saying it was a done deal that I was going to New York [Giants],” Norwell said. “I thought I was going to New York, really. It didn’t turn out that way.”

When asked about the income-tax savings of signing with the Jaguars, Norwell replied: “That’s great, it definitely helps out, putting more money in the player’s pocket.”

Campbell received a double bonus when the free agent signed his four-year, $60 million contract two years ago. Not only did he get the $15 million annual salary he coveted, but not going to his hometown team, the Denver Broncos, for slightly less money represented a sizable boost in another way.

Had Campbell taken somewhere around a $52 million deal with Denver and instead made $13 million last season, he still would have had $601,900 deducted from his 2018 paychecks for the Colorado state income tax (4.63 percent).

While Norwell and Campbell are relatively new to Jacksonville, many former players quickly picked up on the favorable financial conditions of living in northeast Florida. A large percentage of ex-Jaguars, including Jacksonville Beach resident Posluszny, end up staying here.

“My wife and I thought we’d probably end up back in Pennsylvania with our families,” Posluszny said. “But three or four years into living here, we decided we want to stay. Now we don’t want to leave.”

For free agents like Foles and others being targeted by the Jaguars, they may soon understand the monetary benefits of coming to Jacksonville, especially when they see no state income tax coming out of their paycheck.

“That’s something guys should definitely pay attention to,” Hurst said. “There’s potential for millions of dollars to be lost.”

NFL Tax Tables

With 32 NFL teams having headquarters in 23 different states (Washington Redskins are in Virginia), the state income taxes vary across the board for all players. Here’s a breakdown of the state income tax percentages on the highest income earners for states that have an NFL team:

*States having a flat income tax for all incomes.

State: Team(s) (Income Tax)

Arizona: Arizona Cardinals (4.54%)

California: Rams/Chargers/Raiders/49ers (13.3%)

*Colorado: Denver Broncos (4.63%)

Florida: Jaguars/Dolphins/Buccaneers (none)

Georgia: Atlanta Falcons (6%)

*Illinois: Chicago Bears (4.95%)

*Indiana: Indianapolis Colts (3.3%)

Louisiana: New Orleans Saints (6%)

Maryland: Baltimore Ravens (5.75%)

*Massachusetts: New England Patriots (5.1%)

Michigan: Detroit Lions (4.25%)

Minnesota: Vikings (9.85%)

Missouri: Kansas City Chiefs (6%)

New Jersey: New York Giants/Jets (8.97%)

New York: Buffalo Bills (8.82%)

*North Carolina: Carolina Panthers (5.5%)

Ohio: Cincinnati Bengals/Cleveland Browns (5%)

*Pennsylvania: Philadelphia Eagles/Pittsburgh Steelers (3.07%)

Tennessee: Titans (None)

Texas: Dallas Cowboys/Houston Texans (None)

Virginia: Washington Redskins (5.75%)

Washington: Seattle Seahawks (None)

Wisconsin: Green Bay Packers (7.65%)

Note: Players employed in states with no income tax are subject to a pro-rated tax whenever their NFL team plays a road game at a location that has a state income tax. Last year, the Jaguars’ players and employees who traveled with the team had deductions in their next paycheck after playing road games against the New York Giants, Kansas City Chiefs, Indianapolis Colts and Buffalo Bills.

In addition to state income taxes, employees of six NFL teams — Baltimore Ravens, Detroit Lions, Indianapolis Colts, Kansas City Chiefs, Philadelphia Eagles and Pittsburgh Steelers — are subject to additional locality income taxes that range from 1 percent to 3.98 percent for players working in those cities.

Differing deductions

Hayden Hurst, a Baltimore Ravens rookie tight end from The Bolles School, was the No. 25 overall selection in the 2018 NFL draft and chosen four slots ahead of Jaguars’ rookie defensive tackle Taven Bryan. Though Hurst received a bigger contract (4 years, $11.1 million) and signing bonus ($6.1 million) than Bryan (4 years, $10.155 million, $5.465 signing bonus), the state income tax and locality tax burden for Hurst made his take-home pay an estimated $175,700 less than Bryan.

Here’s what they earned in 2018 and the comparable tax burdens for each player, not including taxes on paychecks after road games played in states with an income tax:

Player | 2018 salary/signing bonus | federal tax | state tax | city tax | total withholding taxes | net income

Hayden Hurst | $6.58 million | 37% | 5.75% | 2.95% | $3,010,350 | $3,569,650

Taven Bryan | $5.94 million | 37% | None | None | $2,199,650 | $3,745,350

gfrenette@jacksonville.com: (904) 359-4540