Lakers Rumors: Luxury Tax Concerns Are Outweighed by Potential Title Rings

The Los Angeles Lakers have chosen the potential for NBA championship rings over their future financial security.

You didn't think picking up two massive contracts this offseason was going to come without potential complications, did you? According to NBC Sports reporter Kurt Helin the Lakers may have a tough time turning a profit for the next few seasons: 

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But the Lakers are all in for the next two seasons with the roster they have.  And with luxury tax and revenue sharing in July 2014 they are going to be writing about a $130 million in checks to the league in addition to their $100 million payroll. 

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Helin mentions at the beginning of his report that the Lakers are the league's No. 1 payroll by a $17 million margin. The new luxury tax stipulations mean that doesn't come without penalty. Helin's report contains a detailed explanation from cap specialist Larry Coon. Here's a small piece of that:

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The Lakers will have a tax bill of around $30 million next July, and in retrospect, will view this season as their salad days — it’s the last one where the tax rate is dollar-for-dollar. Starting in 2013-14 the new “incremental” tax takes over, where being $30 million above the tax line will mean paying a whopping $85 million tax bill.

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That's a lot of money, even for a major market team like the Lakers. Their current core of players commands a tremendous amount of cash, and they will have to wait until 2014 before any of that comes off the books. 

It's not like this means the end of the Lakers franchise or anything, but money is real in the NBA. Luxury tax hits are going to severely diminish the team's profit margins, and the Buss family isn't going to make as much money for a few years at least.

All of this comes down to what the Lakers' front office values more. Winning an NBA title this year, and possibly in the future, came down to making two blockbuster moves to improve their starting rotation. 

Just like any sport, those players come with a price. The cash the Lakers' organization is going to shell out to their core, in my opinion, is worth it, but only if Los Angeles does ultimately bring home a title.

As Coon mentions in Helin's report, starting in 2014-15 "a team $30 million over the tax line will pay—brace yourself—an additional $115 million in luxury tax" because of the repeat offender violations. Los Angeles' overages will add up, and they won't go away with things as they currently stand.

Obviously this is a bit of an all-or-nothing approach. Jerry Buss and the Laker brass wouldn't have made these moves, knowing the potential financial ramifications, if they didn't completely believe that the team in place can bring home the NBA's ultimate prize.

They can, and they will. Even if Los Angeles does slip up when it matters, you're not going to find anyone who thinks the Lakers didn't take the right risk in this situation.

Sports are about championships, and the Lakers did what was necessary to maximize their chances. The Buss family is in hot pursuit of the franchise's 17th NBA championship, and money is clearly no object.