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The Magic aren’t giving up hope anytime soon and will look to build on their inspiring first-round fight under a new head coach. The Eastern Conference will be tougher next year, with tanking expected to be curbed and teams like the Pacers, Hornets, and Heat on the rise. It isn’t out of the realm of possibility that they make a run at a top seed, as many expected them to last season.

With that said, the Magic have several challenges ahead of them starting this offseason. They now have one of the more expensive payrolls in the league, with limited means to improve the roster. Their objective this summer is not only to find ways to add depth, but to maintain it. They are expected to be taxpayers, and they’ll happily do so if the team is good enough. But they need to do so in a sustainable way in the apron era, and it’ll be challenging with their payroll expected to continue rising at the top end of the roster.

Salary cap and apron situation

The Magic are entering the offseason with 11 players on the roster totaling $217 million in salaries. They are projected to be over the $200.5 million luxury tax line and $209.1 million first apron. Their high payroll is the result of a top-heavy roster and Paolo Banchero’s five-year, $239 million maximum contract set to kick in. It’s accompanied by Franz Wagner and Desmond Bane, who are also making around 25 percent of the salary cap.

The current team effectively leaves the Magic operating as a second apron team when factoring in that they need to fill two roster spots before the start of the regular season. Their payroll is $4.7 million below the $221.7 million second apron, so they could theoretically stay below it by signing one veteran minimum player ($2.45 million) and the 46th pick in the 2026 draft to a rookie minimum salary ($1.35 million). However, that is negated by Bane’s $1.3 million in unlikely incentives that count against their total salaries for apron purposes.

Teams above the second apron are severely limited in roster-building resources. They cannot aggregate salaries together in a trade, even for one player making as much or less than the outgoing total. They have no form of the mid-level exception, cannot receive a player in return for signing and trading one of their own free agents, and cannot trade cash. They are limited to re-signing their own players, signing players they own the draft rights to, and signing minimum players to increase the payroll.

Teams above the second apron also have their first-round pick seven years into the future frozen, meaning it is unable to be traded. For example, the Cavaliers will be unable to trade their 2033 first-round pick as a result of finishing above the second apron in 2025-26, but they can unfreeze it by remaining under the second apron in three of the subsequent four seasons. Teams with frozen draft picks would also see them drop to the end of the first round if they remain above the second apron in two of the subsequent four seasons.

Perhaps the biggest reason teams want to avoid the second apron is the expensive luxury tax penalties associated with it. The new punitive system penalizes teams with higher tax rates starting above the second tax level. The second apron threshold coincides with the third tax level, so teams pay higher rates by virtue of being in second apron territory.

All these reasons make it highly unlikely that the Magic will operate as a second apron team. President of basketball operations Jeff Weltman said recently that they will pay the luxury tax this season. How much they’re willing to pay is unclear. They’d face a small penalty in the $10-20 million range as a team near the first apron than one in the $40 million-and-up range for teams at or above the second apron.

The Magic also probably don’t want to freeze their 2034 first-round pick in case they need to trade it. They are currently limited to trading just one first-round pick this season: either their 2032 or 2033 first-round pick. If they remain under the second apron in 2026-27, they could trade their 2027, 2032, and 2034 first-round picks in 2027-28.

So the Magic are going to need to reduce payroll significantly, not just to get under the second apron, but to have enough space below it to fill out the rest of their roster. The firing of Jamahl Mosley indicates that they won’t trade any of their top six core pieces. They’ll want to see how the core looks together under a new coach and with better health before coming to any conclusions on whether all the pieces work or if changes are needed.

The solution to their payroll issues will likely come from moving on from Jonathan Isaac. He has a $14.5 million salary, but only $8 million of it is guaranteed for next season. He will almost certainly be the Magic’s cap casualty. The bigger question is if they trade him, waive him, or stretch the remainder of his guaranteed portion.

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After that, there is much work to be done on the roster if the Lakers are going to become legitimate title contenders. They acquired Doncic with a roster not best suited for him. They are now entering a pivotal offseason with the opportunity to reshape the roster with more compatible pieces and much-needed defensive personnel by using cap space.

It’s still unclear exactly how much cap space the Lakers will have and if it will even result in the roster changes they want. But there are more uses for it beyond traditional free agent signings. This guide will explain how their cap space will be calculated, how free agents like Reaves and LeBron James factor into it, how they can use it to add to the roster, and what else they can do after spending it.

Cap space projections and how Austin Reaves factors in

The Lakers are entering the 2026 offseason with 11 players tentatively on the roster, but that’s before factoring in pending option decisions. They have several players with player options, most notably Austin Reaves. He’s expected to decline his $14.9 million player option and is the upcoming free agent in the league most likely to.

That would leave the Lakers’ total payroll at a maximum of $95.7 million. Their proximity to the salary cap would have them operate as a cap-space team for the first time since 2019. They would be able to use cap space to sign free agents up to their respective maximum salaries, make imbalanced trades for expensive players under contract, and claim waived players. They would also have access to the $9.3 million room mid-level exception afterward to sign a player for up to three years, $29.5 million.

Although the Lakers’ payroll is roughly $70 million below the $165 million salary cap, they don’t actually have that amount in cap space yet. They would need to renounce free agent cap holds to realize that space. Cap holds are placeholders that artificially keep teams above the salary cap. Teams typically don’t renounce them if remaining over the cap preserves more useful flexibility than creating cap space.

More importantly, cap holds represent a player’s Bird rights to his team. Teams can re-sign a player up to the limits of his respective Bird rights as long as they don’t renounce them. To access cap space, the Lakers would need to renounce the Bird rights to several of their highest-paid free agents, including LeBron James, Rui Hachimura, Maxi Kleber, and Luke Kennard. They would also renounce the rights to all free agents who haven’t been on the team for years, like Carmelo Anthony and Dwight Howard.

The Lakers’ total cap space projection is very fluid and likely won’t be determined until the week before free agency starts. As shown on the cap sheet, they could create around $53 million in cap space if they renounce all cap holds, and even more if they decline Nick Smith Jr.’s team option and waive Bronny James. They’re likely to operate with closer to $48 million because they’ll keep Reaves’ cap hold on the books.

Reaves will be a free agent with full Bird rights upon declining his player option. The cap hold for players with Bird rights is calculated as either 150 percent of their previous salary if it was greater than the estimated average salary, or 190 percent of their previous salary if it was less than the estimated average salary. That determination was made last offseason, when the estimated average salary for the 2025-26 season was set at $13.87 million.

Reaves will have a $20.9 million cap hold, which is 150 percent of his $13.9 million salary, because it was slightly higher than the $13.87 million estimated average salary. That narrow margin makes a significant difference in the Lakers’ cap space projection. They’ll have nearly $6 million more cap space with his $20.9 million cap hold than they would have had with a $26.4 million cap hold under the 190 percent multiplier.

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It seems like their first-round upset against the Celtics will be the peak moment fans remember from this iteration of the Sixers. They are now in the process of finding a new general manager, indicating that whatever plan was made two years ago has been scrapped. That decision was essentially made for them when their lottery luck rewarded them with VJ Edgecombe. Edgecombe and Maxey are now the priorities of the franchise, with Embiid and George on two of the most negative-value contracts in the league.

The Sixers are heading into another offseason with a top-heavy roster and little depth. They’ll have limited flexibility to upgrade the roster and will have challenges keeping all their free agents. The new front office will need to weigh the value of its draft picks in the lottery-flattening era against maximizing the next few years around Maxey and Edgecombe. This all leaves them stuck between a retool and fighting for mediocrity as they wait for Embiid and George’s contracts to get closer to expiration.

Salary cap situation

The Sixers are heading into the 2026 offseason with 12 players combining for $186.2 million in total salaries. They will operate as an over-the-cap team and, given their recent history, likely below the first apron. This spending tier would give them the ability to use expanded trade exceptions to take in more salary than they send out, sign-and-trade for free agents, use the $15 million non-taxpayer mid-level exception, and use several of the trade exceptions they created last season.

In the previous two seasons, the Sixers have gone into the season over the luxury tax line without exceeding the first apron. They needed to go into tax territory to field a somewhat viable bench with a roster featuring three max players. But they didn’t want to go too far above the tax, so they could potentially get under it later. Teams only pay tax penalties if they finish the season above the threshold, so they reduced enough payroll by the trade deadline to duck it after it became clear they weren’t title contenders.

The Sixers could operate under a similar path, assuming they don’t trade Embiid or George. Trading one of them for multiple players earning less than them would allow them to field a deeper roster while potentially remaining under the tax, depending on how much salary they save. Otherwise, they’re unlikely to replicate the level of bench depth they had last season without exceeding the tax, at least to start the season.

This past postseason may have clarified whether this group can contend for a championship. They had everyone healthy and peaking at the right time, and they couldn’t get past the second round in one of the weakest Eastern Conference seasons in recent memory. It seems like the answer to whether they can win a title is a resounding no. That could eventually become a significant source of tension regarding Maxey.

Maxey has by far had the best season of his career. He’s emerged as a legitimate first option and made enough strides on defense to be passable on that end. The Sixers are at risk of wasting two to three more years of his prime if they do not move off Embiid or George. They will probably need the cap flexibility and talent infusion such a trade would provide, considering that Edgecombe, as incredible as his rookie season has been, may still be a couple of years away from being a legitimate second option.

In all likelihood, the Sixers must make an aggressive move involving Embiid or George’s contract just to keep their current standing. They only finished as the seven seed and just two games above the 10 seed in a season where all five teams outside the Play-In Tournament picture were racing to the bottom. They could plausibly be passed in the standings by teams like the Heat, Hornets, and Pacers if they remain complacent.

As of now, it’s still unclear what direction the Sixers will go this summer. Bob Myers, President of Sports for HBSE, stated as much while remaining open to the possibility of finding a way to compete for a championship with three max players. We may get more clarity on their direction once they hire a new general manager, but the truth seems fairly obvious. They’ll eventually pivot away from this group. The real question is how soon they will make it happen.

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The Celtics are now entering the offseason with more questions after an early playoff exit to the Sixers. It could go a number of different ways, from mostly running it back within a tight budget to potentially trading Jaylen Brown. Cleaning up their cap sheet was just half the battle. Now they need to start finding undervalued players who could help make them top-tier title contenders again once they’re ready to start going deep into the tax again.

Salary cap situation, luxury tax plan, and draft assets

It’s important to understand the Celtics’ luxury tax situation before discussing any possible roster changes. As explained on Third Apron, they were always going to trade some of their starters because of several factors. One is the new luxury tax system implemented in 2025-26, which increased the rates for teams the deeper they go into the tax.

The Celtics were also set to pay significantly higher rates because of the repeater tax. They were designated as repeat taxpayers in 2025-26 since they finished over the tax in three of the previous four seasons. The new luxury-tax system increased each tax level by $2 per dollar. The exponential increases from the more punitive repeater rates pushed their roster cost and tax penalty above $500 million.

It was untenable to run back a team with a tax penalty greater than the sum of its players’ actual salaries, even if the Celtics repeated as champions. That is why they aggressively reduced their payroll last offseason in deals involving Jrue Holiday and Kristaps Porzingis. They understandably prioritized financial relief as the primary value in those trades over players who could directly replace them in the rotation.

The Celtics were still above the luxury tax line despite saving over $250 million, but they were within range of getting below it with several moves ahead of the trade deadline. The decision was a long-term play: by getting under the luxury tax in both 2025-26 and 2026-27, they would no longer be in the repeater tax in 2027-28, 2028-29, and 2029-30. That is their true window for title contention, when they can go deep into the luxury tax again while paying the more sustainable standard tax rates.

This context explains why last year’s Celtics roster lacked veterans, with nine players earning rookie-scale or minimum salaries. With that in mind, don’t be surprised if the roster remains relatively similar to last season’s or only receives marginal upgrades. That doesn’t mean they can’t make a significant addition, but it will be difficult to do while adhering to the luxury-tax line.

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Most expected the Pacers to remain mediocre in a historically depleted East and at least stay in the Play-In Tournament mix. Injuries, the loss of Myles Turner in free agency, and a generally bad product, even when their best players were available, left them with one of the worst records in the league and the worst record in franchise history. They were set up to contend again over the next few seasons, and potentially over the next 5-10 seasons if the lottery odds had fallen in their favor.

The Pacers did not reap the full reward of their bad record. The loss of Turner was compounded when they traded multiple first-round picks for Ivica Zubac, one of which became the fifth overall pick in the 2026 draft. Zubac may not be worth a top-five pick in a vacuum, but the Pacers needed a starting center and were not going to get one with that selection. They now have their core and most of their bench in place for next season. The offseason is mainly about making marginal moves to fortify the rotation within a budget.

Salary cap situation and draft assets

The Pacers are entering the 2026 offseason with a nearly full roster, including 14 players with a combined salary of $200.8 million. That leaves their payroll just $279,000 above the $200.5 million luxury tax line and $7.8 million below the $209.1 million first apron. Had they kept their first-round pick, which would have carried a minimum salary of $10.7 million if it landed fourth overall, they would have been above both the tax and the first apron.

One decision the Pacers need to make is how willing they are to spend above the luxury tax line. They were reportedly prepared to go above it after their Finals run, and doing so would have been required to keep Turner while retaining all their top reserves. That would have been a major deviation for a team historically averse to paying the tax. The last time they paid a tax penalty was in 2006, when they owed just $4.6 million. They could have gotten under the tax no later than the trade deadline, but losing Turner kept them under it entirely.

Not retaining a top-four first-round pick may have also clarified the Pacers’ spending question. Maybe they would have been willing to pay some luxury tax had they kept it. The new luxury tax system lowered the rates in the first two levels. For 2026-27, it’s $1 for every dollar spent up to $6.05 million above the tax, then $1.25 for every dollar from $6.05 million to $12.1 million above the tax. As an example, the first overall pick’s $14.8 million salary would have cost roughly $14 million in tax. A $25 million total cost is a lot for a rookie, but a $14 million tax penalty is also low by today’s standards.

Maybe the Pacers would have gotten under the tax later. That would have required trading one or more of their top reserves, such as Obi Toppin ($15 million) or T.J. McConnell ($11 million), along with others. They should be safe now that there is no urgency to reduce payroll. Between Toppin, McConnell, Jay Huff, and their starters, the Pacers will have a full rotation in place ahead of the 2026-27 season with a path to remain under the tax line.

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Eventually, the Raptors had to trade their core ahead of impending free agency because of their contract demands. The return for OG Anunoby featured veterans ready to push them forward, and the return for Pascal Siakam featured draft picks that were eventually traded for veterans. The result is a roster that is likely capped as a true title contender but still strong enough to be relevant in the East. They got what they paid for, but it resulted in an expensive, top-heavy roster.

The Raptors should face tougher competition next season with more teams in the East on the rise. They’ll need to be proactive and address some of their flaws if they’re going to keep their spot or at least remain in the playoffs. Their work will be cut out for them, given the multiple unattractive contracts they have to offer in trades. They’ll need to weigh being aggressive with their draft assets to stay afloat against remaining mildly competitive as is and banking on lottery reform to reward them.

Salary cap situation and draft assets

The Raptors are heading into the offseason with a nearly full roster and a combined $197 million payroll. They will operate as an over-the-cap team that is likely to remain under the $209.1 million first apron. This would give them access to several roster-building tools, such as taking on more salary in a trade than they send out and using the $15 million non-taxpayer mid-level exception.

In all likelihood, the Raptors will also remain under the $200.5 million luxury tax line. They are currently just $3.3 million below that threshold with the roster as is. They could sign a 15th player to a minimum salary contract as their lone offseason move and remain below it. Unless they acquire a superstar who puts them in true title contention, as the Kawhi Leonard trade did, they are unlikely to be taxpayers.

At the same time, they won’t let tax concerns hold them back from making their moves. They’ve shown time and time again that they’re comfortable going over the luxury tax and even the first apron to start the season. They were above both thresholds last season and got under them by trading Ochai Agbaji with a second-round pick to the Nets. They’ll only be penalized if they finish the season above the luxury tax threshold.

The Cavaliers series revealed a lot of positives about the Raptors’ roster. Barnes emerged as a playoff riser on offense for a team in desperate need of a player who could score. Collin Murray-Boyles may be the second-most important player in their long-term outlook. Ja’Kobe Walter and Jamal Shead look like promising rotation players worth investing more into. And R.J. Barrett may have gone from a trade candidate all season long to an integral part of their nucleus.

They got little to nothing from their remaining starters. Brandon Ingram was neutralized in the series, shooting just 33 percent from the field. Jakob Poeltl saw significantly reduced minutes in favor of smaller and more versatile lineups. Immanuel Quickley didn’t play, and maybe the Raptors could’ve won the series if he had. Overall, the Raptors effectively got negative playoff value from 60 percent of their usual starters.

The Raptors need to get a lot more from their starters. They have a top-heavy payroll, with Ingram, Poeltl, and Quickley occupying approximately 46 percent of their cap against the luxury tax. But the group is still a questionable fit with a limited ceiling, even if mostly healthy, and enough things break right for them. They can give this group another year, but it feels like they’re heading toward the conclusion that they’ll need to modify their lineup, especially if their playoff spot is threatened by teams like the Pacers, Heat, and Hornets.

They’ll be on the lookout for upgrades, but actually executing a trade that makes sense is easier said than done. The Raptors were heavily rumored to be in discussions for an upgrade at center, having been linked to players like Jaren Jackson Jr., Anthony Davis, and Domantas Sabonis. No deal materialized because of the negative value of the contracts they would logically need to send out to make a trade work. They would need to trade draft equity not just to acquire their target, but possibly also to incentivize a team to take on some of their players.

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