Why Shohei Ohtani’s Contract Technically Pays Him Only $2M Per Season

Multiple reports Saturday indicated Shohei Ohtani’s 10-year, $700 million contract included “unprecedented” deferrals to ensure the Los Angeles Dodgers can build a championship contender around Major League Baseball’s unicorn.

It appears we now know how much Ohtani has committed to defer. And, well, it serves as another mind-blowing detail in Ohtani’s mind-blowing contract.

“In an effort to enable the Dodgers to continue spending around stars Ohtani, Mookie Betts and Freddie Freeman, Ohtani agreed to defer all but $2 million of his annual salary — $68 million of his $70 million per year — until after the completion of the contract,” The Athletic’s Fabian Ardaya wrote Monday.

ESPN’s Jeff Passan confirmed Ardaya’s report that $680 million will be deferred. The CBT hit on the contract will be around $46 million, per Passan.

Ardaya reported the deferred money is to be paid out without interest from 2034 to 2043. The Athletic reported the deal is expected to be finalized soon.

“The unusual structure is intended to provide the Dodgers additional cash flow and payroll flexibility,” Ardaya wrote, noting Ohtani is believed to make $50 million per year annually in endorsements and off-field ventures. “The deferrals also give Dodgers extra freedom navigating the competitive balance tax, or luxury tax as it’s called.”

Ohtani announced he would be joining the Dodgers on Saturday. His reported contract blows Mike Trout’s $426.5 million deal out of the water. Trout previously was the one responsible for baseball’s largest contract.