NBA Teams' Updated Salary Cap After Day 1 of Contracts, Trades in 2026 Free Agency
While NBA free agents can't officially sign with new teams until July 6, the league's negotiation window opened at 6 p.m. ET on Tuesday, and we've already seen a fair amount of offseason activity.
The flurry of offseason activity began before the draft, when the Milwaukee Bucks agreed to trade Giannis Antetokounmpo to the Miami Heat. Since then, we've witnessed trades involving the likes of LaMelo Ball, Ja Morant and Kawhi Leonard. We've also seen some early contract agreements.
More deals will unfold in the coming days, so let's check in on where each team stands in terms of effective cap space after Day 1.
The league announced on Monday evening that the 2026-27 salary cap has been set at $164.961 million, while the tax level has been set at $200.428 million. Here, we'll examine where teams stand in relation to the tax threshold and dive into some of the latest buzz.
Estimated 2026-27 NBA Tax Space
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Los Angeles Lakers $115.8 million
Chicago Bulls $104 million
Brooklyn Nets $92.5 million
Washington Wizards $76.9 million
Los Angeles Clippers $70.4 million
Detroit Pistons $65.5 million
Utah Jazz $63.1 million
Memphis Grizzlies $56.2 million
Charlotte Hornets $52 million
Dallas Mavericks $48.6 million
Atlanta Hawks $45.5 million
Miami Heat $37.3 million
Golden State Warriors $36.5 million
San Antonio Spurs $36.1 million
Milwaukee Bucks $24.8 million
Cleveland Cavaliers $20.5 million
Philadelphia 76ers $20.4 million
Boston Celtics $19.6 million
Phoenix Suns $14.8 million
Houston Rockets $13.5 million
Toronto Raptors $12.5 million
Minnesota Timberwolves $12.4 million
New Orleans Pelicans $12.1 million
Portland Trail Blazers $11.4 million
Sacramento Kings $3.4 million
Indiana Pacers $2.4 million
New York Knicks -$532,628
Orlando Magic -$10.1 million
Denver Nuggets -$11 million
Oklahoma City Thunder -$13.3 million
*Tax space according to Spotrac.
Financial Overview
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As previously noted, the NBA has set the salary cap at just under $165 million for the 2026-27 season. However, the league doesn't operate with a hard cap the way that some other major sports leagues do. Most teams will operate well above the cap throughout the year, which is why the $200.428 million tax level can be viewed as a more accurate financial limit.
Franchises that surpass the tax level must pay financial penalties while having the non-taxpayer exception ($15 million) replaced with the taxpayer exception ($6.1 million). Many teams will be comfortable operating above the tax threshold, but often not for more than a year or two at a time.
Repeat offenders—teams that exceed the tax level in three of the previous four seasons—face stiffer penalties, which is why some teams will inevitably look to avoid the tax threshold this offseason. Many more will look to avoid the first and second tax aprons, which bring even harsher penalties for the teams that exceed them.
Penalties for teams that surpass the second apron, for example, include the complete loss of the taxpayer exception and the inability to aggregate contracts in trades. Repeat offenders of the second apron (three of five seasons) even face the loss of draft picks, which is why eve the reigning champion New York Knicks may budget against it this offseason.
"We cannot go into the second apron," franchise owner James Dolan said on WFAN last month (h/t ESPN's Vincent Goodwill).
The first apron for the 2026-27 season has been set at $209.015 million, while the second apron is set at $221.686 million. The league minimum salary level is set at $148.465 million.
While it's tricky enough to keep tabs on each team's spending power, things are further complicated by the reality that many deals haven't (and in some cases, can't) become official yet.
According to ESPN's Bobby Marks (h/t Bleacher Report's Timothy Rapp), the trade that will send Leonard from the Los Angeles Clippers to the Toronto Raptors will raise the Raptors' salary to $202 million. However, it can't officially be made until July 6.
An in-depth look at this year's cap and tax figures, salaries, and exceptions can be found here.
Latest Buzz
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The Leonard trade is the latest blockbuster in an offseason that has already been full of them. According to ESPN's Shams Charania, Leonard is headed back to Toronto, while the Clippers will receive Brandon Ingram, Gradey Dick, unprotected first-round picks in 2031 and 2033, second-round picks in 2030 and 2033, and a 2027 first-round swap.
The trade comes after Antetokounmpo was dealt to Miami, Ball was sent to the Minnesota Timberwolves, and Morant was sent to the Portland Trail Blazers.
And while the reported Leonard trade was the biggest bit of buzz to drop on Tuesday, it wasn't the only significant story. Charania reported early in the afternoon that LeBron James has informed the Los Angeles Lakers that he doesn't plan to return.
Many expected that James would make one more run with L.A., especially after the Lakers agreed to a max extension with Luka Dončić's young running mate, Austin Reaves. However, James, who will turn 42 in December, figures to be playing elsewhere this season.
It's unclear where James will wind up, and while his future will be one of the top storylines of the coming week, fans may not get a quick answer. According to ESPN's Ramona Shelburne, James is unlikely to make a snap decision.
The Cleveland Cavaliers are interested in another reunion with James, according to Chris Haynes of NBA TV and NBA on Prime. The Golden State Warriors are at "the front of the line" in pursuit of James, according to NBA insider Marc Stein.
While several teams may make a run at James in the next few days, the free-agent market will hum along without his decision. The list of players who reportedly agreed to deals on Tuesday evening includes Branden Carlson, Kobe Sanders, Keon Ellis, and Luke Kennard.
For a look at all of the latest signings, rumors, and grades, check out Bleacher Report's NBA Live Blog. B/R's full list of offseason trades and signings grades can be found here.
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