Photos by Michael Gonzales/NBAE via Getty Images

As suspected, the luxury tax and Buddy Hield’s contract incentives were the primary culprits.

Sixers fans got a double dose of welcome news Saturday: Joel Embiid was a full participant at practice after an injury scare the night before against the Orlando Magic, and the Sixers converted Ricky Council IV from a two-way deal to a four-year, $7.4 million lightly guaranteed contract.

Michael Scotto of HoopsHype shared the full details of the deal:

The Philadelphia 76ers have signed two-way guard Ricky Council IV to a four-year, $7.4 million deal, which includes $864K in new money this season, is non-guaranteed for the 2024-25 and 2025-26 seasons, and has a team option for the 2026-27 season, league sources told @hoopshype. https://t.co/ibZmmRB5UE
— Michael Scotto (@MikeAScotto) April 13, 2024

If you think $864,000 in new money for this season sounds like a strangely specific number, you’d be correct. It also explains why the Sixers waited as long as they did to sign Council to a standard NBA contract.

The Sixers used a second-round pick to salary-dump Danuel House Jr. at the trade deadline, which helped them duck below the luxury-tax threshold. They also didn’t pay the tax last season, which means that staying under this year would reset the clock on the repeater tax. They couldn’t be subject to it again until 2027-28 at the earliest, which is especially notable since the higher tax and repeater bands sharply increase beginning in 2025-26.

The Sixers spaced out their ensuing 10-day signings and Jeff Dowtin Jr.’s rest-of-season deal to stay under the 14-man roster minimum for the full 28 days they were allotted. That all left them roughly $1.6 million under the tax line heading into Saturday. If Council received $864,000 flat, the Sixers are now roughly $754,000 below the tax.

As we wrote in March, Buddy Hield has a number of his incentives in his contract that could either raise or lower his current cap hit. He’s currently on the books for $19.8 million this season, which includes nearly $1.3 million in likely-to-be-earned incentives such as making the second round of the playoffs, averaging fewer than two turnovers per game and finishing top-10 leaguewide in made three-pointers. (We’ll come back to that last one.)

Hield also has more than $2.2 million in unlikely-to-be-earned incentives, some of which remain undecided. He’d get roughly $188,000 if the Sixers make it to the conference finals, $565,000 if they make the NBA Finals and $377,000 if he shoots at least 40 percent from deep and 85 percent from the free-throw line.

With one game left in the regular season, Hield is shooting 38.5 percent from three, 87.5 percent from the charity stripe and ranks 15th leaguewide in made threes, nine behind 10th-place Malik Beasley. Hield would have to go 14-of-14 from deep against the Brooklyn Nets on Sunday and hit nine more threes than Beasley while trying to keep pace with D’Angelo Russell, Damian Lillard, Mikal Bridges and Michael Porter Jr. In other words, he isn’t hitting either incentive.

Once Hield officially misses out on both, his cap hit will drop to $19.5 million, which will leave the Sixers nearly $1.1 million clear of the tax line. Even if they do make the Finals and Hield gets both of those incentives, they’ll still finish $335,000 under the tax, thus resetting the repeater clock. They just had to convert Council before Sunday’s game or they would have lost the right to do so, which also would have made him ineligible for the playoffs. They seemingly decided that they couldn’t play anything to chance regarding Hield’s incentives.

Here’s why.

If Hield does go on a heater Sunday and finishes within the top 10 leaguewide in made threes, his cap hit would stay at $19.8 million heading into the playoffs, and they’d be $754,000 below the tax line. If this is The Year and the Sixers do make the Finals, Hield would earn more than $753,000 in incentives. The Sixers would finish roughly $350 below the tax line.

It thus made sense for both the Sixers and Council to wait until the end of the regular season before converting his deal. By waiting to see which of Hield’s three-point incentives would or wouldn’t hit, they had a far clearer idea of exactly how much extra money they could offer Council this year. He wound up getting more money for this season than he would have if he signed a rest-of-season contract right after the trade deadline.

Granted, the trade-off was giving up his own contractual control over the next three seasons. The Sixers likely fought hard for that structure to maintain as much flexibility as possible heading into a pivotal offseason. They’ll have no reason to waive him unless they need as much cap space as they can possibly create, though. (Perhaps for, say, a certain forward who plays in Los Angeles?) The difference between Council’s salary next year (nearly $1.9 million) and an incomplete roster charge (not even $1.2 million) is negligible.

Best-case scenario, the Sixers just locked up a young, higher-than-expected upside player for the next three seasons at a dirt-cheap price. Worst-case scenario, they’ll waive him after a year and he just cost the Sixers’ ownership group less than $1 million in total. The reality will likely fall somewhere in between. Either way, they just risked going nearly every penny below the tax line to sign him, which appears to have been a hard red line that they refused to cross. (Given the repeater-tax implications, that’s understandable.)

So no, the Sixers weren’t ignoring our repeated calls to convert Council from a two-way deal to a standard contract. Honestly, the structure of the deal couldn’t have worked out better for the Sixers. They just had to manage their post-trade deadline moves to maximize their remaining space under the tax line with Hield’s incentives in mind. Once it became clear which non-playoff incentives Hield would or wouldn’t hit, they knew exactly how much they’d be able to offer Council.

If that extra money is what made Council amenable to the team-friendly structure of his contract, all the better. But the Sixers’ under-the-radar spacing of their moves over the past two months is what gave them the ability to offer this deal. That’s the exact type of on-the-margins work that Sixers fans should want to see from the team’s front office, as it’s only going to be more important under the NBA’s new collective bargaining agreement.

Unless otherwise noted, all stats via NBA.com, PBPStats, Cleaning the Glass or Basketball Reference. All salary information via Spotrac or RealGM.