IRS to auction deferred Mets contract
Darryl Strawberry did the work, but now you can collect his money from the New York Mets.
Next month, the Internal Revenue Service is auctioning off the remaining annuity from the deferred compensation Strawberry agreed to when he signed a six-year contract with the Mets almost 30 years ago, according to an online posting on the U.S. Department of Treasury website.
The total value of the contract, which covered his 1985 through 1990 seasons, was $7.1 million, but nearly 40 percent of his $1.8 million team option in 1990 ($700,000) was deferred and put into an annuity with a 5.1 percent annual interest rate.
On Jan. 20, the IRS will auction off the right to collect what will amount to roughly $1.28 million paid by Sterling Mets LP, parent company of the Mets, in 223 monthly installments, assuming a realistic sale close date of May 1. As this sale is required through the court system, the winning bid, which cannot be less than $550,000, has to be approved by a judge before the buyer starts collecting.
How a fan could even buy what was originally due to the Mets slugger is a complicated story.
Strawberry was forced to give a portion of the deferred money account to his wife, Charisse, as part of their divorce settlement in 2006, but the payments were never made. In 2010, his ex-wife filed for Chapter 7 bankruptcy protection and, as part of the proceedings, asked for what was owed. But in September of this year, a judge in the Northern District of Florida ruled that the annuity was the property of the IRS, not Charisse, because Darryl still had not settled his tax debt owed for 1989, 1990, 2003 and 2004.
From 1987 to 1990, Strawberry failed to pay $542,572 in taxes, according to court documents. As of November 2013, Strawberry owed at least $80,000 from his tax liability from missed payments in 2003 and 2004.
"Seizure and sale is the last thing we at the IRS want to do," said Michael Devine, spokesman for the IRS' division of Property Appraisal and Liquidation Specialists. "This happens when a person doesn't dispute that they owe the money but can't or won't liquidate the property."
Devine said, in this case, it has reached the point of a judge requiring the IRS to sell what was originally owed to Strawberry in his contract.
It was common practice for the Mets to defer money in contracts. The Mets famously bought out the final year of Bobby Bonilla's contract in January 2000 and deferred the $5.9 million deal into 25 payments of $1,193,248.20 that began in 2011 and ends in 2035. By deferring, Bonilla turned the $5.9 million into $29.8 million after negotiating an 8 percent interest rate on the deferral.
