Luka Doncic’s move to the Los Angeles Lakers may be a game-changer for his career, but it comes at a massive financial cost. Before the trade, Doncic was on track to sign the richest contract in NBA history, a five-year, $345 million supermax extension with the Dallas Mavericks. However, under NBA rules, a player can only sign a supermax extension with the team that drafted them or one that acquired them via trade within their first four seasons.
Since Doncic was dealt to the Lakers in his seventh season, he no longer qualifies for that historic payday. Instead, his extension options with the Lakers will be significantly lower, projected at $271.6 million over four years if signed in 2025 or $296 million over five years if he waits until 2026 free agency.
Beyond the contract limitations, Doncic also faces another financial setback, which is taxes. In Texas, where the Mavericks play, there is no state income tax. California, on the other hand, has one of the highest state income tax rates in the country, meaning Doncic’s earnings will take an even bigger hit. Despite being among the league’s highest-paid stars, these factors could cost him tens of millions in the coming years.
Beyond the contract limitations, Doncic also faces another financial setback, which is taxes. In Texas, where the Mavericks play, there is no state income tax. California, on the other hand, has one of the highest state income tax rates in the country, meaning Doncic’s earnings will take an even bigger hit. Despite being among the league’s highest-paid stars, these factors could cost him tens of millions in the coming years.
Although there are financial drawbacks, the Lakers have much to gain. By acquiring Doncic under these circumstances, Los Angeles effectively avoids the burden of a supermax contract, giving them additional cap flexibility in 2026 and 2027. This means they will have more room to build a contending roster around Doncic while also preparing for a post-LeBron James era. The Lakers now have an elite franchise player at a relative discount, something that could prove to be a major advantage in their championship aspirations.
Contract Options: What’s Next For Doncic?
Now that Doncic is in Los Angeles, his contract path looks very different from what it would have been in Dallas. If he extends in 2025, he would add four years and $228.6 million to his existing deal, bringing his total earnings through 2029-30 to $271.6 million. Alternatively, if he waits until 2026 free agency, he could sign a five-year, $296 million contract with the Lakers. However, if he wants to regain supermax eligibility, his best option might be to sign a shorter deal now and then cash in once he reaches 10 years of NBA service in 2028.
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If Luka Doncic follows this strategy, he could sign a two-year extension with a player option for 2028-29, allowing him to re-enter free agency after his 10th season. At that point, he could sign a five-year deal starting at 35% of the salary cap, projected to be around $417.8 million based on current cap growth estimates. This approach carries some risk as injuries or changes to the salary cap could alter his earning potential, but it also offers the highest financial upside.
Also Read: Luka Doncic Receives Terrible News After Being Traded To The Los Angeles Lakers
