Pitcher Merrill Kelly recently made headlines by signing a two-year, $40 million contract to return to the Arizona Diamondbacks, following a stint with the Texas Rangers. While expressing his fondness for the city and belief in the team’s potential, Kelly also cited financial considerations that influenced his decision.
Kelly’s Career Journey and Recent Return to Arizona
Merrill Kelly, who initially signed with the Arizona Diamondbacks in 2018, has spent the majority of his Major League Baseball career with the team. After being traded to the Texas Rangers during the 2025 season, Kelly decided to return to Arizona this offseason. He finalized a lucrative two-year deal worth $40 million in December, expressing a desire to rejoin the franchise due to his positive feelings about the city and confidence in the team’s roster.
However, during a recent conversation with Foul Territory, Kelly revealed that his return was also influenced by a competing offer from the San Diego Padres.
Financial Factors Influencing Kelly’s Decision
The Padres proposed a three-year, $40 million contract, but Kelly weighed the financial implications of playing in California. He noted the high state income taxes in California, where individuals earning over $742,954 face a tax rate of 12.3%, plus an additional 1% payroll tax for those making more than $1 million.
In contrast, Arizona’s flat 2.5% state income tax rate significantly reduces Kelly’s tax burden. If he had accepted the Padres’ offer, he would have paid an estimated $5.3 million in state income taxes over three years. With his new contract with the Diamondbacks, his tax obligation will drop to approximately $1 million, allowing him to retain an additional $4.3 million over the life of the contract.
Kelly’s financial strategy mirrors that of other players seeking to avoid California’s hefty tax codes, such as Shohei Ohtani, who structured his record-setting contract with similar considerations in mind. As Kelly enters the latter stages of his career at 37, maximizing his earnings has become a significant priority.
John is a seasoned journalist at The Bothside News, specializing in balanced reporting across news, sports, business, and lifestyle. He believes in presenting multiple perspectives to help readers form informed opinions. His work embodies the publication’s philosophy that truth emerges from examining all sides of every story.
