Horne: Signing Lu Dort Presents Tax Issues for Thunder

Erik Horne from the Athletic discussed the pros and cons of the Thunder signing Lu Dort to a full-time NBA contract.

Starting Tuesday, the Oklahoma City Thunder will have seven days to put Luguentz Dort on a full-time NBA contract. According to Keith Smith of Yahoo Sports, sources around the league expect Dort to take the Thunder's open roster spot. 

While this news has fans excited because Dort is proving to be a bonafide NBA defender and, at times is showing the offensive firepower lacked by Andre Roberson and Terrance Ferguson, Dort's signing won't help the Thunder's tax bill. Erik Horne of The Athletic reports that Oklahoma City is less than $40,000 above the tax threshold. 

Don’t blame Davis Bertans one bit. He’s played his way into an eight-figure per year contract this summer. Why risk it for what could be eight meaningless regular season games?

— Chris Mannix (@SIChrisMannix) June 22, 2020

If Sam Presti signs Dort to a minimum contract, that will increase what the Thunder would have to pay in luxury tax. Dort is making just under $80,000 on a two-way contract, and that deal does not count against the salary cap.    

A standard NBA contract will give him a prorated payment of $898,310. Under NBA rules for the 22-team reboot, Dort can stay on a two-way deal and be eligible for the playoffs, unlike in years past. 

Don’t blame Davis Bertans one bit. He’s played his way into an eight-figure per year contract this summer. Why risk it for what could be eight meaningless regular season games?

— Chris Mannix (@SIChrisMannix) June 22, 2020

By keeping Dort on a two-way deal, the Thunder could also use the roster space to sign a veteran player like Gerald Green or Iman Shumpert. However, with only eight games to play before the postseason, and the uncertainty surrounding how the team will perform in training camp, Billy Donovan and Presti might not want to mess with the team's chemistry.   

The biggest positive to signing Dort would be to keep him from becoming a restricted free agent at the end of the season. If Dort became a restricted free agent, the Thunder would have the right to match any offer tendered to him by another team. But if the Thunder are looking to keep salary low next season, they have a breaking point.  

If a team were to offer him a contract that the Thunder deemed too rich for their blood, they could be willing to let Dort go. Let's hope it doesn't get to that point.