The sports world was stunned this week by a record-breaking $12.5 billion deal for the Los Angeles Lakers, led by Thrive Capital founder Joshua Kushner and former Disney CEO Bob Iger. While the acquisition secures an NBA franchise with 17 championships and ties to legends like Kobe Bryant and LeBron James, experts suggest the motivation extends far beyond the court. The deal is increasingly viewed as a sophisticated financial instrument designed for tax optimization.
The Mechanics of a 'Powerful Tax Shield'
Ram Ahluwalia, founder of Lumida Wealth Management, noted that the acquisition serves as a strategic move to offset substantial carried interest income. Kushner, who holds significant stakes in high-growth companies like SpaceX, OpenAI, and Stripe, can leverage the team to create 'non-passive' deductions. This strategy allows wealthy individuals to use paper losses from the sports franchise to shield income from other lucrative ventures, a method Ahluwalia claims is even more favorable than traditional real estate investments.
Depreciation and Intangible Assets
The tax benefits stem from the ability to amortize and depreciate key assets. Under current rules, a team’s roster of players can be treated as an intangible asset that loses value over time. This generates significant accounting losses that can offset taxable income elsewhere, even as the franchise's actual market value continues to appreciate. Similarly, depreciation on stadium infrastructure and the structuring of regional broadcast deals provide additional layers of tax protection.
An Exclusive Investment Class
The Lakers sale follows a pattern of soaring valuations in professional sports. In 2025, the Boston Celtics sold for $6.1 billion, a record that was quickly surpassed when Mark Walter bought the Lakers for $10 billion later that year. Now, Kushner’s $12.5 billion bid sets a new benchmark. Beyond the tax advantages, ownership offers entry into an elite club of owners who control franchises with steady revenue streams, largely guaranteed by long-term media contracts that remain profitable regardless of nightly attendance.
