The NBA trade deadline—and what a deadline it was—has come and gone, but that doesn't mean that teams, particularly those with playoff aspirations, can't still make additions to improve their respective rosters. That's where the NBA buyout market comes into play.
What is a buyout in the NBA?
A buyout is a mutual agreement between a player and a team to prematurely terminate a contract by having a player give up a portion of their salary to become a free agent. However, if an agreement is reached, the player does not immediately become a free agent.
The player is released to waivers, where other teams have 48 hours to claim the player. If the player goes unclaimed on waivers, he then becomes an unrestricted free agent who can sign with any team.
The team that agrees to the buyout does suffer a salary cap hit from the transaction, as the club is on the hook for the remaining salary minus the amount surrendered via the buyout. But it's often a move worth making for the team, which can free up a roster spot for younger players, while the veteran player is granted a chance at competing for a championship, rather than languishing on a losing team.
The league's buyout market has been on full display in the days since the trade deadline, as the likes of three-time All-Star Ben Simmons (Brooklyn Nets to Los Angeles Clippers), Alex Len (Washington Wizards to Los Angeles Lakers) and Torrey Craig (Chicago Bulls to Boston Celtics) have found homes with contenders after having their contracts bought out.
What teams can sign players in the NBA buyout market?
Technically, any team can sign players via buyouts, but the market is generally dominated by playoff contenders and teams on the cusp of the postseason looking to fill any post-trade deadline remaining needs.
However, the league's new collective bargaining agreement with the player's association, agreed upon in 2023, does place some restrictions on which teams can sign players after a buyout.
Per the new rules, a team whose salary is above either the first or second tax apron is not permitted to sign a free agent on the buyout market if his pre-waiver salary exceeded the non-taxpayer mid-level exception.
The first apron level for the 2024-25 season is $178.132 million. This means that any teams with a taxable salary above that first apron cannot sign a player who was cut this season if he was earning more than $12,822,000.
Here is an extensive list of which teams are above the first and second apron in 2024-25, per Spotrac.
Compared to past seasons, in theory, this levels the playing field between the haves and have-nots in the buyout market.
What is the deadline for NBA buyouts?
A player must agree to a buyout and be waived by March 1 if they want to be eligible to play for a new team in the postseason. The player has the option to sign with any team at any time, but veterans eyeing playoff contenders must keep the March 1 deadline in mind.
The NBA's buyout market should heat up in the coming weeks, making for a palatable second course after the appetizing entree that was the trade deadline.
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This article was originally published on www.si.com as What Is the NBA Buyout Market? A Brief Explainer.
