Luxury Tax implications could hamstring Braves in free agency

With the Juan Soto saga seemingly nearing an end, the expectation is for things to really pick up at MLB’s Winter Meetings, which are set to begin on December 8th. The Braves have a plethora of holes to fill, primarily in the outfield and rotation, but it wouldn’t be shocking if Alex Anthopoulos sat back and waited for the market to become more clear before making a splash.

It’s a good time to be a free agent right now. Teams are throwing money around like it’s candy, particularly for starting pitchers. Most recently, Luis Severino, who has a lengthy injury history and is coming off a season in which he posted a 3.91 ERA, landed a three-year, $67 million contract with the Oakland Athletics of all teams. That’s insane money for a middle-of-the-rotation guy that’s had trouble staying on the mound, which isn’t great news for the Braves, who have luxury tax issues to take into consideration while navigating the offseason.

“According to FanGraphs’ RosterResource, the Braves’ estimated luxury tax payroll stands just north of $217 million,” Mark Bowman writes for MLB.com. “This is approximately $24 million shy of MLB’s first luxury tax threshold for the 2025 season. But the current payroll projection doesn’t include the combined costs of the starting pitcher, outfielder(s) and reliever(s) Atlanta must add this winter.

Teams that carry payrolls above the threshold are taxed on each dollar above the threshold, with the tax rate increasing based on the number of consecutive years a club has exceeded the threshold. The Braves would be taxed at a 50 percent rate because this would be their third straight year to exceed the threshold.”

Ideally, the Braves would like to avoid the luxury tax altogether because three straight years in the threshold carries much more lucrative penalties. However, that doesn’t seem at all possible, given their needs.

This is a club that’s smack-dab in the middle of their championship window and is fresh off their third straight first-round playoff exit. They can’t afford to sit on their hands while other teams across the NL East spend freely to better themselves.

However, acting as if it is not a concern is foolish. The Braves probably won’t be willing to go more than $10-20 million over the luxury tax, which only gives them about $30-40 million to play with as of now.

Photo: David John Griffin/Icon Sportswire

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