Newark, Arkansas → Los Angeles. Undrafted in 2021 → $185M max contract in 2026. After California's 13.3% income tax and federal at 37%, here's what he actually keeps.
$41.25M Year 1 · California 13.3% · ~$19.6M Take-HomeOn June 24, 2026, Austin Reaves agreed to a 4-year, $184.76 million maximum contract with the Los Angeles Lakers — the largest deal in NBA history for a player who was never drafted, per ESPN's report. Five years earlier, he couldn't get a single team to select him on draft night. He signed with the Lakers as an undrafted free agent for the minimum, earned a two-way contract, and worked his way into one of LeBron James' most trusted co-stars.
The contract includes a player option in Year 4 (2029-30), meaning Reaves can opt out and re-enter free agency at 31 years old if his market value continues to grow. His salary escalates each year: ~$41.25M, ~$44.5M, ~$47.8M, and ~$51.1M, per Spotrac's contract breakdown.
The catch: he plays for the LA Lakers — in California, which charges 13.3% income tax on earnings above $1 million. Combined with federal taxes at 37%, Reaves keeps roughly 47.5 cents on every dollar.
California's 13.3% top rate applies to all income above $1 million — and Reaves earns $41.25 million. Here's exactly where Year 1 goes.
| NBA salary (Year 1) | $41,250,000 |
| Federal income tax (37% bracket, ~36.9% effective) | −$15,230,000 |
| California income tax (13.3% top rate) | −$5,400,000 |
| Medicare tax (1.45% + 0.9% above $200K) | −$967,000 |
| Social Security (6.2% up to $184,500) | −$11,000 |
| Estimated Year 1 take-home | ~$19,642,000 |
Reaves' salary escalates each year. Here's the estimated take-home across all four seasons.
| Season | Gross Salary | Federal | California | FICA | Take-Home |
|---|---|---|---|---|---|
| 2026-27 (Year 1) | $41.25M | $15.23M | $5.40M | $978K | ~$19.64M |
| 2027-28 (Year 2) | $44.50M | $16.43M | $5.83M | $1.05M | ~$21.19M |
| 2028-29 (Year 3) | $47.80M | $17.65M | $6.26M | $1.13M | ~$22.76M |
| 2029-30 (Year 4 — player option) | $51.10M | $18.87M | $6.69M | $1.20M | ~$24.34M |
| 4-Year Total | $184.65M | $68.18M | $24.18M | $4.36M | ~$87.93M |
Estimates based on current federal and California tax rates. FICA includes Medicare (1.45% + 0.9% surcharge) and Social Security (capped at $184,500). Individual tax situation will vary.
Like all NBA players, Reaves doesn't just pay California taxes. He pays income tax in every state where the Lakers play road games.
The formula: Games in state ÷ total duty days × annual salary × state tax rate = tax owed to that state.
The LA advantage: Because Reaves already pays California's 13.3% — the highest rate in the NBA — most other states provide a credit for California taxes paid. States with lower rates than California effectively cost Reaves nothing extra. Only New York (10.9% + NYC 3.9%) could generate additional jock tax exposure above the CA rate.
Net effect: Unlike players in low-tax states who face significant jock tax exposure in California road games, Reaves already pays the top rate at home — making his road-game tax exposure relatively limited compared to peers playing in Texas or Florida.
The Spurs, Mavericks, or Rockets could hypothetically have offered the same $185M. Texas has zero state income tax. The difference over 4 years is substantial.
4-year take-home after federal + CA + FICA on $185M total contract
Same $185M deal, no state income tax — only federal + FICA apply
California's 13.3% costs Reaves roughly $24 million over his contract compared to playing in a no-income-tax state. For an undrafted player from a town of 1,100 people, every dollar of that gap represents a remarkable story.
On his $41.25M Year 1 salary, Reaves' estimated take-home is approximately $19.64 million after federal tax (~$15.23M), California tax (~$5.4M), and Medicare (~$978K). Over the full 4-year, $185M deal, his estimated after-tax total is approximately $87.9 million.
A 4-year, $185 million maximum contract with the Lakers signed June 24, 2026 — the largest deal in NBA history for an undrafted player. Salaries escalate from ~$41.25M to ~$51.1M, with a player option in Year 4.
California's 13.3% top rate applies on income above $1M. On $41.25M, Reaves owes approximately $5.4M to California in Year 1. Over 4 years, California collects an estimated $24.2M from his contract — more than most Americans earn in a lifetime.
Yes. Not a single NBA team selected Reaves in the 2021 draft, despite two seasons at Wichita State and two more at Oklahoma. He signed with the Lakers as an undrafted free agent and earned every dollar of his $185M deal on merit — confirmed by ESPN as the largest contract in NBA history for an undrafted player.
Reaves was born and raised in Newark, Arkansas, attending Cedar Ridge High School there. He played college basketball at Wichita State (2016-18) before transferring to the University of Oklahoma, where he played his final two seasons. His journey from small-town Arkansas to LA Lakers max contract in 5 seasons is essentially without precedent. See his full bio at Wikipedia.
Over the full 4-year deal, Reaves would keep approximately $24.2M more in Texas (no income tax) vs. California (13.3%). Year 1 alone, the difference is ~$5.4M — the full California tax bill he'd avoid.
Less than most. Because Reaves already pays California's 13.3% — the highest NBA rate — most other states provide a credit for CA taxes paid. Only New York City (combined ~14.8%) generates meaningful additional jock tax exposure above his home rate.
Approximately $87.9 million after federal, California, and Medicare taxes on the full $185M contract — assuming current tax rates and California residency throughout.
13.3% hits everyone earning over $1M in California. Use our calculator to see the full picture for any income level.
Calculate California Take-Home →Salary figures based on publicly reported contract details. Tax estimates are illustrative and based on 2026 federal and California tax rates. Individual tax situations vary. Not financial or legal advice.