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View Full Version : billionaires and the luxury tax



unbalanced
06-27-2010, 09:40 AM
Perhaps a noob question, but with the nba being a soft cap situtation with a luxary tax, and the real income coming from marketing, what is to stop say the nets billionaires owner from ignoring the cap and figuring the luxary cap as a cost to do business?

FOBolous
06-27-2010, 09:45 AM
nothing.

unbalanced
06-27-2010, 09:51 AM
It's just kind of funny that SO MANY psd'ers are talking like the cap is a hard one, ANY team in the nba can pick up LeBron and his Max contract as long as they pay the luxary tax of I believe 1-1 correct?

FOBolous
06-27-2010, 09:55 AM
It's just kind of funny that SO MANY psd'ers are talking like the cap is a hard one, ANY team in the nba can pick up LeBron and his Max contract as long as they pay the luxary tax of I believe 1-1 correct?

yea. but the thing is, not many teams can afford it. that's why teams that wants to sign to max free agents are trying to hard to shed salaries. if they can afford it, they wouldn't bother

Raidaz4Life
06-27-2010, 09:56 AM
It's just kind of funny that SO MANY psd'ers are talking like the cap is a hard one, ANY team in the nba can pick up LeBron and his Max contract as long as they pay the luxary tax of I believe 1-1 correct?

no there still is a cap that you can sign free agents with. You can only sign free agents if you are under the cap. Teams over the cap can use a Mid Level Exception to sign free agents but it only comes out to a total of up to about 5 and a half million a year (basically how the Lakers got Artest last year). The luxury tax and adding more salary would only come into play when resigning your own players.

FOBolous
06-27-2010, 09:58 AM
no there still is a cap that you can sign free agents with.

oh...lol, guses i'm wrong than.

GrumpyOldMan
06-27-2010, 09:59 AM
I may be wrong, but I believe a team can go over the cap and into the luxury tax to resign their own players, but not to bring in free agents. They have to have cap room to bring in free agents.

unbalanced
06-27-2010, 10:05 AM
You can only sign free agents if you are under the cap. Teams over the cap can use a Mid Level Exception to sign free agents but it only comes out to a total of up to about 5 and a half million a year (basically how the Lakers got Artest last year). The luxury tax and adding more salary would only come into play when resigning your own players.

oh thank you for clearing that up, only when used to resign players, and only 5-6 million dollar free agents. So then the Heat who have the only likely returning free agent could use the luxary tax exception if they so chose, giving them more cap room, a whopping 16.5 mil, enough to sign several good players, is that correct, provided they pay that much in luxary tax?

Raidaz4Life
06-27-2010, 10:13 AM
oh thank you for clearing that up, only when used to resign players, and only 5-6 million dollar free agents. So then the Heat who have the only likely returning free agent could use the luxary tax exception if they so chose, giving them more cap room?

I believe that would theoretically be the case (I'm not an expert on the matter). Basically the heat could sign any number of free agents up to the cap and but then resign their own players (Wade) for money over the cap.

This is why the Cavs could also offer more money to Lebron than anyone else. From what I understand there is a "max contract" that players can offer a free agent. So the Heat, Knicks, Nets, Bulls, etc. Can all offer Lebron the same fixed amount of money (I believe in the range of 17 mil a year) but the rule doesn't apply to the Cavs and they can offer him more than that.

Raidaz4Life
06-27-2010, 10:22 AM
Okay wait a minute after reading up on it, Wade's salary still counts against the team's cap unless the renounce his bird rights. So they actually wouldn't gain any additional money towards free agency. So either they could have wade's contract on the books (16 mil) and resign him with his bird rights, or renounce Wade's bird rights and have his salary off the books when counting towards free agency.

ragee
06-27-2010, 10:53 AM
It's just kind of funny that SO MANY psd'ers are talking like the cap is a hard one, ANY team in the nba can pick up LeBron and his Max contract as long as they pay the luxary tax of I believe 1-1 correct?

The only way other teams that are over the salary cap can get Lebron is via sign and trade with Cleveland...


I may be wrong, but I believe a team can go over the cap and into the luxury tax to resign their own players, but not to bring in free agents. They have to have cap room to bring in free agents.

Teams can go over the salary cap to resign their own players provided the player they are resigning has bird rights...