The Dodgers, Mets and Yankees were the highest penalized among the record nine teams to be over the MLB's luxury tax threshold for 2024.
A record nine MLB teams were over the luxury tax threshold for 2024, according to a memo sent to teams on Friday and obtained by ESPN.
The six other teams, along with their penalties, who had Competitive Balance Tax payrolls higher than $237 million, which triggers the tax, include the2 Related The Dodgers, Mets, Yankees and Phillies were taxed at a base rate of 50% because they've been over the tax in three or more consecutive years. The Braves and Rangers exceeded the threshold for the second consecutive year, earning a 30% tax rate. The Astros, Giants and Cubs were first time offenders, earning a 20% tax on overages.
A team's CBT figure is determined using the average annual value of each player's contract on the 40-man roster, plus any additional player benefits. Every team's final CBT figure is calculated at the end of each season. The Dodgers' CBT payroll for 2024 was $353,015,360, while the Cubs were just over the threshold at $239,851,546.
The first $3.5 million of proceeds is used to fund player benefits. Fifty percent of the remainder go to player retirement funds, while the other half goes into the Supplemental Commissioner's Discretionary Fund and is redistributed among teams that receive revenue sharing.
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