NBA Teams on the Verge of Salary Cap Hell

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NBA Teams on the Verge of Salary Cap Hell
Chris Chambers/Getty Images
Carmelo Anthony and Amar'e Stoudemire, New York Knicks

With the current NBA CBA (Collective Bargaining Agreement) in place, the luxury tax is increasingly punitive for teams that are repeatedly and/or flagrantly over the tax line. Five squads might already have problems with it as early as next season.

ESPN NBA writer Larry Coon summarized the new luxury tax rules and the consequences for breaking them.

Teams pay $1 for every $1 their salary is above the luxury-tax threshold in 2011-12 and 2012-13. Starting in 2012-13, teams pay an incremental tax that increases with every $5 million above the tax threshold ($1.50, $1.75, $2.50, $3.25, etc.). Teams that are repeat offenders (paying tax at least four out of the past five seasons) have a tax that is higher still -- $1 more at each increment ($2.50, $2.75, $3.50, $4.25, etc.)[…]

Taxpaying teams have a smaller midlevel exception, can acquire less salary in trade, and cannot use the biannual exception. Starting in 2013-14, teams more than $4 million above the tax level cannot receive a player in a sign-and-trade transaction.

We don’t yet know what the cap and tax numbers will be for the 2013-14 season—the tax line is currently $70.307 million. Still, a handful of teams run the risk of taking real estate in luxury-tax purgatory if things don’t change.

 

All salary numbers courtesy of Hoopsworld.com.

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