According to CBS Sports, Smith is prepared to sign a four-year contract with the Knicks, but the kicker is that they can only offer him a deal starting at around $5 million per year.
As the defending Sixth Man of the Year, Smith can probably make more on the open market and may change his mind once he sees the offers other teams put on the table.
It will take a lot to pry Smith from the team that he loves, but if there's anyone who can do it, these four teams have the best situations to offer him.
If it wasn't for injuries, the Minnesota Timberwolves could have been a playoff team this season, but it wasn't to be.
The Brandon Roy experiment didn't work out, and now the Wolves should be looking for another 2-guard to pair with Ricky Rubio.
Smith would fit the bill, providing scoring and athleticism, fitting into an exciting offensive team.
Rubio is the type of point guard who could make Smith look great, and that's something he should bear in mind.
Minnesota's star Kevin Love complained about a lack of talent on the team last summer and this is the type of move that can help fix things. Smith is a player just about to enter his prime, and coming off a career year can make a big difference for the Wolves.
The cold of Minnesota probably isn't all too enticing to Smith, but if he wants to be part of a potential playoff team and make more money, this would be a solid choice.
With Greg Monroe and Andre Drummond in place, the Detroit Pistons have an impressive, young frontcourt, but the same can't be said about their guard pairing.
There is still hope for Brandon Knight to develop eventually, but with Rodney Stuckey entering the last year of his deal, it may be time to add some more young talent to the fray.
Detroit has only the eight overall pick in this year's draft, so they may have to turn to free agency to find elite talent. J.R. Smith would be an interesting fit and would likely welcome the chance to be the centerpiece of a team's offense.
This would be a smart move for the Pistons, as Smith wouldn't just be a short-term investment. He's someone the franchise can build around and that can develop into a true star if they find the right head coach.
Detroit would have to offer Smith a lot of money just to get him to consider the move, though. It's hard to picture him leaving New York to be part of a perennial lottery team, especially considering the questionable coaching situation.
The Phoenix Suns are in desperate need of someone to sell to their fans, but with a top-five pick and a lot of cap space, it may not be too long before they field a competitive team.
Goran Dragic is a solid point guard, as is Marcin Gortat at center, and J.R. Smith would fit nicely at either wing position.
Like with Detroit, Smith may be open to the opportunity to be the central part of a team's offense, where he would take over from the likes of Michael Beasley and Wesley Johnson.
Smith would be a major upgrade over both players, and Jeff Hornacek could really use the help to rack up some more wins as he enters his first year as head coach.
Realistically, Phoenix is shaping up to be a mediocre team over the next few seasons, so it may not be wise for Smith to give up the best years of his career to be a part of it. He'd probably take being Carmelo Anthony's second option over having little help and likely missing out on the postseason in the desert.
As the team with the best 2012-13 record on this list, the Utah Jazz would likely be the most interesting to J.R. Smith outside of sticking with the Knicks.
Utah only narrowly missed out on the playoffs last season, and with the addition of J.R. Smith and a few more pieces—which they definitely have the cap space to afford—that could change next year.
The Jazz will likely choose between Al Jefferson and Paul Millsap to go with Derrick Favors and Enes Kanter, but after that the focus will have to shift to the backcourt.
Clearly, Utah is stacked with bigs, but outside of Gordon Hayward they don't have much talent elsewhere on the roster.
Smith could put a stop to that, taking the role as the go-to scorer as a player who can consistently create his own shot.
Utah itself isn't the most attractive city in terms of endorsements, but with the offer of an increased salary, a bigger role and playoff basketball, it could be interesting to Smith.