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Tax Obligations and rockets 19 pick from forbes

Discussion in 'Houston Rockets: Game Action & Roster Moves' started by Le$$, Feb 15, 2019.

  1. Le$$

    Le$$ Member

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    "Particularly with the trade of Knight, the team's financial future comes more into focus. With Knight off the books, Houston has obligations of $119 million in guaranteed salaries for the 2019-2020 season when the luxury tax threshold is expected to be $132 million. For 2020-2021, that figure is about $108 million with an expected luxury tax threshold of $143 million. And in 2021-2022, they have $107 million committed, all towards the trio of James Harden, Chris Paul, and Clint Capela.

    There is no publicly available figure regarding the luxury tax threshold in that season.
    The guaranteed figures above include the expected raises for Harden and Paul, the most significant of which is the 2018-2019 to 2019-2020 jump in Harden’s salary from $30.4 million to $37.8 million. If the Rockets remain below the luxury tax line this season, they'll stay safely out of repeater tax territory during the duration of the Harden/Paul/Capela era. (To be hit with repeater tax penalties, a team has to have already paid the tax in at least three of the previous four seasons and then be over the line again for the season in question.)

    I had thought general manager Daryl Morey would use the roughly $15 million of Knight's salary to bring in another major piece to the roster, either this season if Knight’s value had inflated upon his return, or next year when he would have become an expiring contract. Instead, the Rockets cleared their own books, sacrificing their 2019 first round draft pick to get off of Knight's contract, and receiving Shumpert whose deal is set to expire this summer. The Knight salary now is dead as there is next to zero chance of Shumpert being resigned at a figure comparable to what Knight was set to make.
    " - Forbes

    https://www.forbes.com/sites/rahath...ligations-in-the-next-few-years/#51cfe9977f8d


    I honestly think trading Gordon for picks will have to be necessary if they bounce out the 1,2, or even lucky to get to west finals again. I have no idea where the rockets are going, they are tied in with the big 3 they have, and there is no room for improvement with a aging paul. I see this there last chance for a title, and they basically couldn't put anything together with Harden to upgrade the roster, mainly cause of the tax. Sad.....
     
  2. bilaal14

    bilaal14 Member

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    Get off the gas brooo.
     
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  3. malakas

    malakas Member

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    I had no idea that forbes had bball cap articles.
     
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  4. Dr of Dunk

    Dr of Dunk Clutch Crew

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    lol. The guy that wrote it used to be a member here, too.
     
    bumbum09, Lawlruschang, Deuce and 6 others like this.
  5. topfive

    topfive CF OG
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    Oh yeah, I remember that guy.
     
  6. Jayzers_100

    Jayzers_100 Member
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    JC Denton?
     
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  7. heypartner

    heypartner Contributing Member

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    That's a nice pivot from what he wrote 11 days ago, prior to the trade deadline

    What They Need To Do

    The Rockets are absolutely buyers at the deadline for no other reason than that they cannot waste an all-time historic season from the reigning MVP. Reportedly, the Rockets offered four first round draft picks to the Minnesota Timberwolves in their early-season pursuit of All-Star guard Jimmy Butler. I would expect close to that same level of urgency at the deadline. After all, with an aging supporting cast, and a growing tax bill, the Rockets have no choice but to be all-in.
     
    Deuce, Gray_Jay and J Sizzle like this.
  8. tycoonchip

    tycoonchip Member

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    If anyone runs into Tilman Landry, thank him for ruining the Rockets!
     
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  9. Corrosion

    Corrosion Member

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    I think he got a dose of reality …. I think we all hoped they would show that same level of urgency and do something significant at the deadline … Our reality is they chose to avoid the tax instead.
     
    saleem likes this.
  10. BigBum

    BigBum Member

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    This guys came here to kill the fantasy 3 weeks ago. Many want to ban him.

    He has a good point. Unlikely big 4 in the east has so many assets, morey has to trade gordon to improve next year.
     
  11. vick

    vick Member

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    Tilman has made money by buying low, selling for a profit. He got Rockets by buying high, and destroying a 2.2b dollar franchise. The most ever for an NBA team. Like buying a Mercedes, and 5 years later sells it for spare parts.
     
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  12. vlaurelio

    vlaurelio Contributing Member

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    Les is the cheapskate. Sold the rockets as soon as we got Cp3. Then asked for too much.

    Tilman badly wanted the team so he overpaid and now he's low on funds (profit from the team and his businesses were below his expectations). Can't really blame him.
     
  13. BigBum

    BigBum Member

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    MLE 9 million
    Bae 3.6 million
    Room exception 4.7 million
    Total 17.3 million

    Tax room 11.5 million for 7 players
     
  14. MC31B

    MC31B Member

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    Well I guess there is no point in watching them anymore.....

    The repeater tax means that teams can only overpay for 3 years. I don't think the worriers can keep this up, despite what their owners say. We almost beat them before they had Cousins. But this year they are probably the most talented team ever.

    I don't put this on Tillman. I put this on Les for not letting us have a couple of lottery years to add talent to Harden. Regardless Let's not get angry until we see who we pick up at least and we really should be patient until we see how much is spent this coming offseason.
     
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  15. Hank McDowell

    Hank McDowell Member

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    The reality is that they needed to do something NOW because the future really doesn’t look bright. They sold out for this group, but didn’t follow through with what needed to be done to make this team a realistic championship contender. The Chris Paul contract, along with Morey’s other recent blunders, has ****ed this team fairly significantly. Hopefully things will look brighter with Capella back, but for now it doesn’t appear that this team will be a serious contender as currently constructed, and it’s not going to get any easier in the coming years. It’s hard to be optimistic about the trajectory of the organization at the moment. Morey swung for the fences in keeping Chris Paul, but it’s probably going to cost him in the long run. **** happens!
     
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  16. RayRay10

    RayRay10 Houstonian
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    - We’ll have the Full MLE next season ($9M) since we’ll be under the luxury tax (huge reason for Morey to get there).
    - We also get back our Bi-annual exception ($3.5M).
    - We picked up two decent trade exceptions for Chriss and Knight ($3.6M & $3.2M).
    - There will be a possible 16 teams that can drop below the salary cap at the start of free agency which means they don’t require similar contract values back for trades. Teams shooting for top stars prior to free agency, of which there will be many, may be looking to offload contracts and the Rockets could get some value (and a pick or two).

    This idea that we can’t improve after this year is so far-fetched. We’ve actually positioned ourselves well for next year while sort of hoping that this year’s team can put it together come the postseason. Morey had goals this season to acquire guys and those deals fell through, so he went to Plan-B which is flexibility for the future.
     
  17. Corrosion

    Corrosion Member

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    We wont have the Full "MLE" of $9m …. We will have the taxpayer version of the MLE which is about $5.5m

    We Absolutely WILL NOT have the BAE .


    Go back to the drawing board.
     
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  18. roslolian

    roslolian Member

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    Why will the Rox have the tax payer MLE next year when they are not paying the lux tax this year?
     
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  19. Corrosion

    Corrosion Member

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    Paying the tax this year has nothing to do with next year.

    Use of the FULL MLE hard caps you just like use of the BAE - at the apron meaning at no point during the league year can you exceed the apron which is ~$6m below the Tax Line.

    Its almost a guarantee that they are taxpayers next season …. I did the numbers in another thread (digging it up)….


    **************************


    We read it but some of the OP's statements are not factual , mainly about which version of the MLE we will have to spend.

    We wont use the non taxpayer version which hard caps you at the apron. We'll literally be at or above the apron with 8 contracts and minimum cap holds.

    Harden - $37,800,000
    Capela - $16,396,552
    CP3 - $38,506,482
    Tucker - $8,349,039
    EG - $14,057,730
    Nene - $3,825,360
    Clark - $1,416,852
    Hartenstein - $1,416,852

    Salary for those 8 players - 121,768,867

    Add on 4 cap holds at the 2nd year minimum of just over $1.5m = $6m and change. putting you at $127,768,867 before adding a single player.

    Use of the non tax payer MLE of $9m immediately puts you over the apron. Cant use it.

    Bottom line is , next year this franchise is all but guaranteed to be paying the tax.


    *********************


    No T-MLE and no BAE.

    We'll have the taxpayer version of the MLE which is about $5.5m.


    This is why I was so critical of the dumping of Knights contract - Unless they resign Shumpert which makes either He or EG's contracts a movable asset in place of Knight & that #1 pick.
     
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  20. NateNate

    NateNate Member

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    Damn can we even improve the roster next year?
     
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