Rumor: Warriors looking for luxury tax relief at trade deadline, Knicks among potential partners
The Golden State Warriors have been among the few NBA teams using the upcoming trade deadline as an avenue for luxury cap relief. The team has already been elbows deep in the luxury tax after bringing in a coalition of stars during their reign of terror in recent years.
The New York Knicks are one of the teams that have touched base with the Warriors, looking to unload assets that would allow the latter to shave some of the tax penalties that await them as a repeater team, according to SNY’s Ian Begley.
The Knicks have several pieces with expiring contracts, ones they can part with before Thursday’s Feb. 6 deadline in a win-win scenario — shedding an unwanted contract and helping the Warriors slice part of their future tax commitments.
John Hollinger of The Athletic wrote about this potential scenario in December, forecasting what could be a series of small-time deals amid what could be an otherwise quiet trade deadline without any major splashes:
If subject to the repeater tax again in 2020-21, the Warriors’ tax hit could be monstrous. If they use the Iguodala exception and their taxpayer mid-level exception, and add a first-round pick near the top of the draft, Golden State’s payroll next season could reach $175 million or more, which would trigger a gigantic $108 million luxury tax bill. The repeater would add $34 million on top of that.
Warriors ownership had prepared to face incredulous amounts of tax coming their way, which could be easily funded by the revenue of the state-of-the-art Chase Center. However, no owner wants to pay tax dollars for an underperforming team — a scenario the team didn’t foresee for this season.
Golden State can get out of repeater status by getting below the luxury tax this season, but they could qualify as such in 2021-22 once the hefty part of the Curry and Thompson max contracts start to kick in. There are new rumors that the Warriors are listening to trade offers for D’Angelo Russell, though nothing is imminent.