The sale of the Chicago Cubs has seemingly dragged on longer than the team’s World Series title drought, but we’ve generally been able to ignore it if we’ve so wished.
After all, unless it affected the team’s abilities to trade for Jake Peavy or add more deadline difference makers like John Grabow(notes) and Tom Gorzelanny(notes) (heh), who really cared what rich guy was going to walk away with a shiny new plaything thing?
But as the sale finally lurches toward a possible completion between Sam Zell and the Ricketts family, the public’s scrutiny on the sale is becoming much more warranted and deserved. Currently in question is the legal maneuvering that Zell and the Ricketts are trying to pull off so that the former can avoid paying taxes on any profits made from the latter and put the savings of about $300 million toward the enormous debt that he saddled the Tribune Company with. No, the Cubs may not be headed to the World Series, but Zell is still in contention to make 2009’s World Series of tax dodging.
We’ve known for awhile that Zell would be try this hidden ball trick, but columnist Allan Sloan shined a brighter and more critical light on the deal in his Washington Post column this morning. I suggest you go read it for all the little details, but, in short, Zell and the Tribune Co. are trying to retain a token five percent stake in the team to avoid paying a capital gains tax on a completed sale.
Zell’s PR people say the partnership is by the book, but the IRS isn’t likely to issue a free pass on an estimated $300 million in tax revenue