How Warriors' projected tax bill could skyrocket to over $160 million

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It's still way too early to know the depths of the financial ramifications the coronavirus pandemic will have on the Warriors and the NBA as a whole.

But the people who have a deep understanding of the collective bargaining agreement and all its complexities are helping paint the picture.

Unfortunately, the outlook is not rosy.

As ESPN's Adrian Wojnarowski and Bobby Marks recently wrote:

The CBA has a projected 2020-21 salary cap of $115 million, with a luxury tax threshold of $139 million. With the reality of lost revenues coming, some teams fear that cap and tax could fall as far as $25 million to $30 million. Without the league and union negotiating a new mechanism for the cap in the coming months, the league could be facing 25 of its 30 teams trapped in luxury tax payments based on projected payrolls -- something that would paralyze free agency and many organizations' ability to operate financially.

For example, Golden State's projected tax penalty of $45 million would rocket to $160 million before free agency even started.

Holy moly.

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The Warriors would like to be aggressive in free agency, as they have the taxpayer mid-level exception at their disposal, and can use all or some of their $17.2 million traded player exception.

Remember, one of the reasons Golden State worked hard to duck below the luxury tax line before the NBA trade deadline in early February was to have more financial flexibility this offseason.

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But the franchise might be forced to change course.

"We don't really know what we can plan on at this point," Golden State owner Joe Lacob told Tim Kawakami of The Athletic a month ago. "We just have to look at a lot of different scenarios. That's what we're doing right now.

"It could make a huge difference, it might make no difference."

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Fortunately, there was a little bit of good news from Woj:

There's optimism that the NBA and union can work through these issues and agree on how the league's financial landscape will be recalibrated on a number of issues, including the 2020-21 salary-cap and luxury tax thresholds, sources said.

Even still, it's going to be extremely challenging and not every team will be happy in the end.

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