NBA Rumors: Cleveland Cavaliers, Luxury Tax & Bringing J.R. Smith Back


Building a championship team doesn’t have to be expensive. Keeping it together is, as the Cleveland Cavaliers are learning. The rise in the salary cap does help them cut a little bit of their enormous wage bill, but it still makes them luxury tax offenders, and they still haven’t signed J.R. Smith.

The salary cap rising took the luxury tax threshold upward with it, currently at $113.3 million, compared to just $84.7 million last season. Due to cap penalties and the luxury tax multiplier, the Cavs paid $54 million in luxury tax last season, $34 million more than the next in line. This season, even with LeBron James signing a one-year, $30.9 million contract, and with J.R. Smith probably returning for $10 million to $12 million a season, they’re expected to pay no more than $35 million in luxury tax.

The Cavaliers currently have $117.6 million spent on total salaries. It will rise up to about $130 million once Smith is re-signed, and it’ll be a huge surprise if he doesn’t end up playing for them, considering no one can pay him the money he wants ($15 million a season), and the (good) direction his career has gone in since leaving the New York Knicks and joining the Cavaliers.

Last season, the Cavaliers paid around $160 million overall to win their NBA championship, joined by the Golden State Warriors, Los Angeles Clippers and Oklahoma City Thunder in luxury tax land. It’ll rise to about $165 million in order to complete the roster this season. This sheds some light on the reason the Cavaliers have been patient, or simply stingy, with some of their assistant coaches, taking quite a while to re-sign them, with some of them reportedly working without a contract over the summer.

The money spent on coaching doesn’t count against the cap, but that’s still money spent, and some teams try to cut costs where they can, although that could lead to some sort of crisis between Tyronn Lue and the front office.

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