What springs to mind when you think about Stephen Curry? The impossible half-court shots, the flair in his game, the silhouette of a killer, a millionaire, and we still only know a fraction of what he is capable of.

Curry is a top performer at his day job. One may argue that few players are better than him. Regardless of his status, being one of the finest has significant advantages. Curry, like previous season, was the highest-paid player in the NBA.

He received $48 million for the 2022–2023 campaign. While the number appears to be huge, it is often deceiving. While NBA players are paid a high wage, they must also pay a high tax rate. Most of them are state or federal taxes levied on millions of dollars. The NBA also collects a tax known as NBA Escrow.

What is this tax? We will go into greater depth about the upcoming formation. However, based on last season’s bookkeeping, Stephen Curry is about to profit significantly.

Stephen Curry and others win as the NBA unveils the Escrow update.

Before the start of each season, the league estimates the amount of basketball-related income that will be generated that year. According to the amount, they established a salary cap for the teams to adhere to. According to the Collective Bargaining Agreement, players are entitled to 51% of the total BRI, while the league receives the remaining 49%. However, because these are projections, the NBA deducts 10% of each player’s salary to allow for any changes in income. The money is put into an account called NBA Escrow.

It serves the objective of maintaining the equilibrium established by the CBA. If business goes smoothly, the Escrow funds are refunded to the players. In the event of a downturn, the league maintains the money.

We last witnessed such a case in the 2019-20 season, also known as the ‘Bubble’ season. The NBA increased the Escrow to 25% of the player’s salary due to revenue volatility caused by empty stands, no ticket sales, and so on. The money is mostly collected to offer protection to the owners in the event that player salaries exceed the specified proportion of the BRI.

Generally, this tax benefits the players. Fortunately, the NBA had a record-breaking financial year last season. Following all of the auditing for the 2022-23 season, the NBA announced that it only needed to withhold 2.65% of the 15% it collected as Escrow tax from the players. According to Sportico, all players will be entitled to 97.35% of their total salaries.

Stephen Curry reaped the most benefits of all. He was set to earn $48 million last season and made the largest initial commitment to the Escrow fund. Now that the league has distributed about 700 million to the teams, Curry will receive a cheque for the 12.35% owing to him. The actual sum would be $7,009,200.

Unlike the NHL, NBA Escrow pays its players at the end of the year. And it should be so. Stephen Curry and all other NBA players exert themselves during the season, contributing significantly to the league’s $4.5 billion in income.