Skip to content

Chicago Bulls creating offseason trade options with latest signings (updated)

Apr 16, 2014, 9:22 AM EDT

Atlanta Hawks v Chicago Bulls Atlanta Hawks v Chicago Bulls

Update: I miscalculated. The Bulls are safe from the luxury tax — at least unless Joakim Noah and Taj Gibson each get $500,00 bonuses.

Because Andrew Bynum signed with the Pacers, Chicago can set off a portion of his salary ($105,564 in this case) — an amount I didn’t account for. That leaves them $791,165 beneath the tax line — more than the $750,000 in leeway discussed below.

Noah ($500,000 for All-NBA first team) and Gibson ($500,00 for All-Defensive first team) could still send the Bulls into the tax. However, even if the Bulls hadn’t signed Ronnie Brewer, Lou Amundson, Mike James and Greg Smith, they still would have had more than $750,00 but less than $1 million in leeway.

So, Chicago can absorb a $500,00 Noah bonus for All-NBA first team and a $250,00 Gibson bonus for All-Defensive second team and avoid the tax. But if Noah and Gibson each get $500,000 bonuses, Chicago will pay the tax.

It’s the same situation regardless of whether the Bulls made their latest run of signings.

In sum, these signings won’t make the Bulls more likely to pay the luxury tax, but they’ll cost Chicago a few extra real dollars. In return, the Bulls get more trade flexibility — a definite win for them.

Original post: The Chicago Bulls, like every team, would like to avoid the luxury tax.

Not only are luxury-tax penalties already costlier than ever, repeater penalties loom. If a team might be willing to pay the tax only while contending, it’s especially prudent not to pay the tax when out of contention.

That’s what makes the Bulls’ situation so fascinating.

With all due respect to the marvelous job Tom Thibodeau, Joakim Noah and crew have done this season, Chicago is an extreme longshot to win the 2014 championship. But once Derrick Rose gets healthy, Nikola Mirotic signs, the Bulls use both their 2014 first-round picks (one from Charlotte) and exhaust their pending cap space… Chicago could get really good – and really expensive – in a hurry.

Yet, the Bulls have flirted with the luxury-tax line this season while still remaining pretty competitive. It’s a tight line to walk – wanting to keep salary low without completely blowing up the team (a dichotomy the Luol Deng trade accomplished).

Chicago caught a big break in that quest when they waived Erik Murphy and the Jazz claimed him, removing his salary from the Bulls’ books. That positioned Chicago to add up to three players and leave $750,000 in leeway under the luxury-tax line for performance incentives potentially due to Joakim Noah ($500,00 for All-NBA first team) and/or Taj Gibson ($500,00 for All-Defensive first team or $250,000 for All-Defensive second team).

The Bulls opted to go another way, though.

Chicago signed Ronnie Brewer, Lou Amundson and Mike James to minimum-salary multi-year contracts, according to Larry Coon. Amundson’s’ agent, Mike Bartelstein, confirmed his client’s contract was for two years. James’ agent, Bernie Lee, did the same for his client.

The multiple years matter, because the NBA pays a portion of the minimum salaries for veterans with at least three years experience and the league’s portion of the payments are not taxed – but only for one-year, 10-day and rest-of-season contracts. By signing those three to multi-year deals, Chicago assumed all payments and the increased tax burden that comes with them.

On the positive side, the Bulls signed Greg Smith – who surprisingly cleared waivers – without having to worry losing their $750,000 leeway, because they’d already lost it.

Smith – like Brewer, Amundson and James – could prove useful in trades after the season. Smith is a talented young big man, and the other three have unguaranteed contracts, according to Coon. That allows their salaries to help a trade match, and then they could be released them without penalty.

All in all, the Bulls are now $685,601 below the luxury-tax line – meaning they can absorb only one of the bonuses potentially due to Noah and/or Gibson without paying the tax.

If the bonuses due to Noah and Gibson fall short of $750,000, the Bulls win. They’ll avoid the luxury tax and will have added potentially useful trade assets.

But if Noah and Gibson both hit their incentives, the Bulls will pay the tax, though they’ll still have tradable assets in Smith, Brewer, Amundson and James.

It’s a calculated risk that I think will work. I project Noah to make the All-NBA first team, but I don’t have Taj Gibson making an All-Defensive team.

However, the downside – paying the tax – is high enough that I don’t believe the multi-year deals were worth it. Had the Bulls waited until Saturday to sign Brewer, Amundson and James, Chicago would have kept its $750,000 luxury-tax leeway and still signed Smith, anyway.

Chicago is choosing to play with tax fire to better position itself for a trade later, perhaps a revealing strategy about the franchise’s long-term plans.

Latest Posts
  1. Hawks’ Thabo Sefolosha says police incident damaged his reputation

    May 29, 2015, 10:00 PM EDT

    Thabo Sefolosha AP

    Sefolosha suffered a leg fracture during a police incident that kept him from participating in the playoffs.

  2. Suns shake up their coaching staff

    May 29, 2015, 8:00 PM EDT

    Phoenix Suns v Sacramento Kings Getty Images

    Jeff Hornacek remains in charge, but there has been some shuffling among his assistants.

  3. PBT Extra: Houston Rockets face interesting off-season

    May 29, 2015, 7:01 PM EDT

    Dallas Mavericks v Houston Rockets - Game One Getty Images

    There are questions about the future of Josh Smith, Patrick Beverley and others with the team.

  4. LeBron James on how to slow Stephen Curry: “The same way you slow me down … You can’t.”

    May 29, 2015, 6:15 PM EDT

    OAKLAND, CA - FEBRUARY 12:  Stephen Curry #30 of the Golden State Warriors goes in for a layup over LeBron James #6 of the Miami Heat at ORACLE Arena on February 12, 2014 in Oakland, California. NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this photograph, User is consenting to the terms and conditions of the Getty Images License Agreement.  (Photo by Thearon W. Henderson/Getty Images) Getty Images

    The two most popular players in the NBA this season (with Kevin Durant out) go head-to-head on the NBA’s biggest stage.

  5. PBT Extra with NBASavant.com: Cleveland may want to cover Curry in the left corner

    May 29, 2015, 5:29 PM EDT

    Houston Rockets v Golden State Warriors - Game Five Getty Images

    Cleveland’s defense has looked better in the playoffs than it has all season, but starting next Thursday it will get the biggest test it has had all season.

  6. It’s official: Scott Skiles hired as head coach of Orlando Magic

    May 29, 2015, 4:53 PM EDT

    150523_skiles Getty Images

    Skiles is a former Magic player from 1989 through 1994.

  7. Cookin’ with the Currys, guest-starring Riley Curry (video)

    May 29, 2015, 4:30 PM EDT

    Stephen Curry Stephen Curry

    Ayesha Curry cooks, Stephen Curry tastes, and Riley Curry points out raspberry-sauce spills

  8. PBT Podcast: Talking Thibodeau/Bulls divorce; future for Rockets, Hawks

    May 29, 2015, 3:45 PM EDT

    Chicago Bulls v Cleveland Cavaliers - Game Two Getty Images

    Would hiring Thibodeau really a wise call by the Pelicans?

  9. Warriors’ Klay Thompson officially diagnosed with concussion

    May 29, 2015, 3:09 PM EDT

    Klay Thompson Klay Thompson

    The NBA needs to review this process going forward.

  10. Klay Thompson should not have been cleared to return to Game 5 after concussion evaluation

    May 29, 2015, 2:14 PM EDT

    Klay Thompson Klay Thompson

    Warriors guard passed, but not enough time had passed to determine his health

  11. Rumor: Thunder promised to draft Cameron Payne No. 14

    May 29, 2015, 12:43 PM EDT

    Cameron Payne, Reece Chamberlain AP

    Believable, but is that why it’s believed?

  12. Report: Cavaliers could activate Anderson Varejao in NBA Finals if necessary

    May 29, 2015, 12:04 PM EDT

    Chicago Bulls v Cleveland Cavaliers - Game One Getty Images

    Varejao was slated to miss the entire season with an Achilles tear

  13. Dwight Howard suspended one game after foul switcheroo

    May 29, 2015, 11:17 AM EDT

    Dwight Howard, Klay Thompson Dwight Howard, Klay Thompson

    NBA gives Rockets center a flagrant foul, rescinds technical fouls for him and Andrew Bogut

  14. Report: Magic could hire Scott Skiles as soon as today

    May 29, 2015, 10:54 AM EDT

    NEW YORK, NY - MARCH 26:  Head coach Scott Skiles of the Milwaukee Bucks looks on against the New York Knicks at Madison Square Garden on March 26, 2012 in New York City. NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this photograph, User is consenting to the terms and conditions of the Getty Images License Agreement.  (Photo by Chris Chambers/Getty Images) *** Local Caption *** Scott Skiles Getty Images

    Contract negotiations reportedly ongoing

  15. National Spelling Bee co-champion wore LeBron jersey under dress shirt

    May 29, 2015, 9:45 AM EDT

    Gokul Venkatachalam predicts Cavaliers in 6

Did Chicago do the right thing in firing Thibodeau?

Despite ending, Hawks had season to remember
Top 10 NBA Player Searches
  1. S. Curry (8113)
  2. K. Love (5850)
  3. K. Irving (5604)
  4. L. James (4369)
  5. K. Korver (4276)
  1. K. Bryant (3650)
  2. A. Varejao (3582)
  3. D. Howard (3557)
  4. K. Durant (3551)
  5. M. Speights (3294)