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The other benefit of Beltre's contract

Posted by Peter Abraham, Globe Staff  January 5, 2010 12:42 PM

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Ken Rosenthal of Fox Sports makes an interesting point today. The creative contract the Red Sox signed Adrian Beltre to will soften some of the damage as they approach the luxury tax threshold.

Under the terms if the collective bargaining agreement, player options are considered guaranteed years when calculating the tax, which is based on the average annual value of the deal. So Beltre goes into the books as a $7 million player, not a $9 million player. According to Rosenthal, if Beltre opts out of his deal, the Red Sox would be charged $7 million in 2010 and $2 million in 2011 to account for his entire salary.

Why is this important? For every dollar spent over the $170 million barrier, the Red Sox would be taxed 30 percent.

For an organization like the Red Sox, that's not a major concern. But Theo Epstein still needs to assemble a bench beyond Jason Varitek and Jeremy Hermida and saving $2 million against the tax on Beltre could help him add a better player than he otherwise might have.


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A reader pointed out that Rob Bradford mentioned the luxury tax implications over on Full Count last night. In fact, he certainly did. Apologies to Rob.

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