The Lakers Just Sold For $12.5B, But Uncle Sam Wants His Cut

The Los Angeles Lakers have been sold for a record $12.5 billion to a group led by Josh Kushner and former Disney CEO Bob Iger, marking the second ownership change in just over a year. The previous owner, Mark Walter's group, acquired a majority stake in October 2025 at a $10 billion valuation, realizing a swift $3 billion profit. However, this substantial gain faces significant tax liabilities. Depending on the sale's timing, Walter's group could owe between $1.1 billion and $1.3 billion in federal and state taxes. This dramatically reduces their after-tax profits to around $1.7 billion, underscoring the considerable tax reality of even record-breaking sports franchise sales.

The Los Angeles Lakers have been sold for the second time in just over a year. A group led by Josh Kushner (younger brother of Jared Kushner) and Bob Iger (former CEO of the Walt Disney Company) purchased the franchise for a reported $12.5 billion. This sales price marks the largest amount a team has been purchased in the history of professional sports. The previous owner, Mark Walter and his group, held a 71% stake in the Lakers, the majority of which was acquired in October 2025. The appreciation in value on this transaction translates to approximately $3 billion in profits. While this is a tremendous windfall for owning a franchise for just a small time period, a chunk of this money will soon fall into the hands of the U.S. government because a gain realized on the sale of a business is subject to tax, and the tax liability might vary by $100s of millions depending on the timing of the sale.

The Los Angeles Lakers have only seen a small number of team owners in their history – until this year.

In a deal also involving the Los Angeles Kings and the Los Angeles Forum, Dr. Jerry Buss famously purchased the Lakers from their previous owner, Jack Kent Cooke, in 1979 for $67.5 million.

Prior to his death in 2013, Buss ran the Lakers during a stretch where the team won 10 NBA championships. After Buss’s passing, his children took ownership and control of the team.

The Buss family’s 46-year run as owners ended in June 2025 when they agreed to sell majority control to Mark Walter and his group, a deal that finalized in October 2025. Walter and his group own 71% of the team, according to the Los Angeles Business Journal, and the majority of their stake in the team was purchased at a $10 billion valuation.

However, less than a year later, their group is headed for the exits with Kushner and Iger agreeing to buy the team at a valuation of $12.5 billion, according to The Wall Street Journal. This sale marks a stunning change for a team that the Buss family took nearly half a century to build.

The Lakers’ 2026 sale raises many questions, and taxes happen to be one of them.

Walter’s 71% stake in the Lakers took place over two different purchases. Their group bought a 27% stake in the Lakers in 2021 at a $5.5 billion valuation (approximately $1.5 billion cost).

Selling that same 27% stake at the current $12.5 billion valuation brings in $3.375 billion, a taxable gain of approximately $1.89 billion. As Walter and his group held this stake for one year and one day or longer, it will receive a preferable long-term capital gain treatment, which will be subject to a 20% federal tax, a 3.8% federal net investment income tax, and a 13.3% California state income tax.

The combined blended rate on this tranche of ownership amounts to a blended tax rate of 37.1%. On a gain of $1.89 billion, Walter and their group will owe approximately $701 million.

Where there could be wildly fluctuating tax considerations is the second tranche of ownership, a 44% stake that was acquired in October of 2025. Using the $10 billion valuation, this ownership has a cost basis of $4.4 billion. Selling that 44% ownership at a valuation of $12.5 billion brings in $5.5 billion, a gain of $1.1 billion.