NBA Players Will Lose $480 Million From The League's Escrow System

The 2024-25 NBA season is officially in the books. The Oklahoma City Thunder defeated the Indiana Pacers in an exciting seven-game NBA Finals. We saw the next generation of stars get selected in the NBA Draft. And the league put the finishing touches on its accounting reports for the season.

Basketball-related income (BRI) came in at $10.25 billion, per Sportico. That sounds like a staggering number, but it's actually below the projections the league was hoping to reach. As a result, players will only make 90.9% of their salaries from the 2024-25 season, forfeiting a collective $480 million.

Buckle up, because we're about to do a little math.

Nikola Jokic (L) and Stephen Curry are among the players most impacted by the escrow. (Jamie Schwaberow/Getty Images)

The NBA has had an escrow system in place since 1999, ranging from 8% to 10%. The league's collective bargaining agreement currently gives players 51% of BRI, with the escrow typically split between players and owners. However, the surge in the league's salary cap over the past decade or so led to players receiving 100% of the escrow for three straight seasons, from 2014-15 through 2016-17.

Then, COVID-19 hit in March 2020, shutting down the league for over four months. The escrow was raised to 25%, with a "ten-and-spread" system set for the following three years, hoping to even out any remaining irregularities between player and team earnings.

This year, 91% of the escrow will go to teams, with the remaining 9% returning to the players. That means players will walk away with 90.9% of their original 2024-25 salaries.

So, Stephen Curry, the highest-paid player in the NBA last season at $55.8 million, will forfeit $5.1 million of that salary. Former MVPs Nikola Jokic and Joel Embiid will give up $4.7 million apiece, while the former Phoenix Suns duo of Bradley Beal and Kevin Durant will give up $4.6 million and $4.5 million, respectively. However, with the way the Suns' season went, maybe fans in Phoenix think that's a fair trade.

Coming seasons should avoid this problem, especially after the league just signed a lucrative media agreement with NBC, ABC/ESPN, and Amazon worth $77 billion. Player salaries will continue to rise, and they'll get to keep the full extent of their earnings.

In the grand scheme of things, these players should be okay. They all have off-the-court endorsement deals and partnerships that will likely more than make up the difference. Still, it's a tough pill to swallow—imagine learning in the middle of summer that you had to give back about 9% of your earnings from the past year. That would feel crummy, no matter how much money you had to return.