Holiday’s contract includes a series of incentives that he can earn on top of his base salary, and he has reached many of the necessary benchmarks in 2020/21. As Marks detailed earlier this year, the 31-year-old received three separate $255K bonuses for meeting criteria related to games, minutes played, and rebounds per game. He also earned $100K for making the All-Defensive First Team and $200K when the Bucks made the NBA Finals.
The Bucks, whose team salary had been right up against the luxury tax line at the end of the regular season, have now crossed that line and will officially be a taxpayer for the 2020/21 league year, according to Marks.
As Marks observes, Milwaukee’s tax bill will be modest and it’s a price team ownership will happily pay in exchange for the franchise’s first championship in 50 years. Still, it’s a detail worth noting, since teams face increased tax penalties when they become “repeat” taxpayers, having paid the tax in three of the previous four seasons.
The Bucks haven’t been a taxpayer since 2003, so the repeater tax won’t apply this year. But with lucrative long-term deals on the books for Holiday, Giannis Antetokounmpo, and Khris Middleton, the Bucks may well find themselves in tax territory again in future seasons and are now more likely to face repeater penalties down the road.