Luka Dončić contract extension options: Lakers star expected to sign, but for how much and for how long?

Luka Dončić may have only spent a few months with the Los Angeles Lakers, but by all accounts, he is ready to make a longer-term commitment. On Aug. 2, the extend-and-trade restrictions limiting what Dončić can earn in a deal with the Lakers expire. At that point, he is expected to sign a contract extension to remain in Los Angeles. At present, he is committed to the Lakers only through the end of the 2025-26 season thanks to a player option he holds after this year. His new deal will lock him up longer.

The question here is how much longer? When Dončić played for the Dallas Mavericks, he was expected to re-sign on a supermax deal that would have added five years to his existing contract. He is no longer eligible for the supermax, though, because the Lakers neither drafted him nor acquired him during the first four years of his career. That limits his potential earnings on a new deal to 30% of the cap in the first year of the deal rather than the 35% he would have gotten in Dallas. It also chops at least one year off the end of the deal. Dončić is only eligible to add four years to his existing contract.

Does he want to add all four? That’s what we’re waiting to find out. There are three potentially viable contract options for Dončić this offseason: a one-, two- or three-year pact, all with player options at the end. Each offers unique advantages. So let’s go through each of them and attempt to figure out what sort of contract Dončić should sign with the Lakers in August.

Option 1: The one-plus-one

Under this scenario, Dončić would only commit one extra year to the Lakers: the 2026-27 season. He would then have a player option for the 2027-28 season. Based on the current estimated cap growth of 7% and the maximum allowable 8% annual raises, this is what such a deal would look like:

2025-26 (existing contract)	$45,999,660
2026-27 (new contract begins)	$49,641,687
2027-28 (player option)	$53,613,021
Total	$149,254,368

The obvious appeal of a deal like this would be maximizing flexibility. Dončić has only been with the Lakers for six months. An extension like this would signal a minor commitment, giving them more runway to build their team, but would also give him an easy way out if he isn’t satisfied with whatever they do. By all accounts, though, Dončić has been an active participant in the roster-building process. He reportedly recruited Marcus Smart. His agent, Bill Duffy, represents Deandre Ayton, so if Dončić had any objection to playing with him, they likely wouldn’t currently be teammates. It certainly seems as though Dončić is prepared to make a longer commitment to the Lakers than just a single year.

However, that isn’t the only reason a one-plus-one extension should appeal to Dončić. At least at present, both Giannis Antetokounmpo and Nikola Jokić are slated to become free agents in 2027. Both could obviously extend before then, and recent league history suggests that if either wants to move, they will do so via trade before ever hitting the open market. Dončić could also scheme to partner with one of them in a city outside of Los Angeles. But even if he’s dead set on Los Angeles as the venue for such a union, giving himself the player option for the 2027-28 season just opens more doors for him.

Say the Lakers need a couple of extra bucks to squeeze in a max salary or add a particular supporting piece. If Dončić is locked into a contractual number, there’s nothing he can do to help the Lakers with that. If he has a player option, though, he can just take slightly less for the 2027-28 season and then make it back up a year later. After all, the Lakers will have full Bird Rights. So if they do indeed plan to remake the roster with 2027 cap space as has been so heavily speculated, having a bit of flexibility on Dončić’s salary for that season would be beneficial. They’d obviously prefer to have him locked in longer-term, but the ball is in Dončić’s court here. This is probably the least likely of our three options, but it’s a tempting one for the roster-building possibilities that come with it.

Option 2: The two-plus-one

The basic contract structure here would be basically the same as the deal we covered above. It would just include an extra year.

2025-26 (existing contract)	$45,999,660
2026-27 (new contract begins)	$49,641,687
2027-28	$53,613,021
2028-29 (player option)	$57,584,355
Total	$206,838,723

In terms of long-term earning power, this is probably the contract structure that makes the most sense for Dončić. Why? Because it would allow him to become a free agent after his 10th NBA season. Max contracts are determined by experience. As Dončić has currently played only seven seasons, he is eligible to start a new contract at just 30% of the cap. Once he reaches 10 years of experience, however, that figure jumps to 35%. As we covered, Dončić would have been eligible for 35% this offseason had he remained in Dallas. Obviously, he didn’t.

The plan here would be for Dončić to play out the next three seasons at his lower max, and then become a free agent as soon as he is eligible for the higher 35% figure. On that deal, he would presumably re-sign for as long as possible, either five years with the Lakers or four years with a new team, depending on how these next few seasons in Los Angeles play out.

If this is the structure that Dončić takes, he would be eligible for free agency as a 29-year-old, right smack in the middle of his prime. He will also have presumably spent three-and-a-half years with the Lakers, giving them ample time to either prove to him that they are capable of putting a championship team around them or fail in that pursuit. This is, essentially, the balance option. The Lakers get a three-year window with Dončić making less than he’s worth. That’s an enormous competitive advantage. If they can’t take advantage of it, Dončić would still have several prime years left to find a team that could.

Option 3: The three-plus-one

Once again, the basic contract structure is identical to what we’ve covered above. We’re just adding that final year.

2025-26 (existing contract	$45,999,660
2026-27 (new contract begins)	$49,641,687
2027-28	$53,613,021
2028-29	$57,584,355
2029-30 (player option)	$61,555,689
Total	$268,394,4132

This is the security option. If Dončić just wants to guarantee himself as much money as possible this offseason, this is the structure he’ll take. Every player has different priorities, but there’s always a reason to mitigate risk. Injuries happen. Unforeseen decline happens. Dončić is as insulated against those things as a player can be, all things considered, but nobody is invincible. We’re talking about an extra $120 million or so in guarantees relative to the one-plus-one offer we covered first. That’s a lot of money.

Would a contract like this cost Dončić some flexibility? Potentially. While free agency’s power as a vehicle for star movement has faded lately, its existence still gives stars leverage. Consider Damian Lillard. For so much of the past few years, all we’ve heard about star movement is that the best players just take the money and then force trades later. Lillard tried to do that. He signed a supermax extension in Portland in 2022. In 2023, he wanted a trade to Miami. However, with three years of team control remaining on his deal, he didn’t have the leverage to scare away the Milwaukee Bucks. Dončić will be much younger than Lillard was at that point throughout this contract, and he’s a better player, too. The longer he’s locked in for, the less control he’ll ever have over a future trade.

But we should acknowledge here that Dončić does not play for the Portland Trail Blazers. He plays for the Los Angeles Lakers. Stars very rarely choose to leave the Lakers. Lillard had spent years trying and failing to recruit co-stars to Portland. Dončić likely won’t have that same issue in Los Angeles. By signing on for as long as possible, Dončić not only shows the Lakers his commitment, but also other stars as well. Such a contract would be a powerful recruiting tool for him as he attempts to build the champion in Los Angeles that he narrowly missed out on in Dallas.

So… what is Dončić going to do?

There has been some buzz already that Dončić plans to take the four-year pact, which would in all likelihood be that three-plus-one structure we covered (why not take the option when it’s available?) Dončić is expected to play for Serbia at Eurobasket this summer, with his head coach, Aleksander Sekulić, saying that he expects “him to arrive after Aug. 4, when he has completed all his obligations in the USA.” One such obligation would be signing his new contract. In that same story, Martin Pavcnik of SportKlub wrote that Dončić had reportedly agreed to a four-year, $229 million extension, though the story is written in Serbian, so it’s possible context got lost in translation. 

That $229 million figure is what Dončić’s max was expected to be when the offseason began, but the lowered cap growth projection from 10% down to 7% lowers that number slightly down to around $222 million, as we covered in the three-plus-one scenario above (subtract the $46 million he’ll make on the last year of his present contract and that’s where you land). With no corroboration from other sources, it’s hard to say for certain how much weight we should put on the SportKlub story.

We’ll treat the one-plus-one option as by far the least likely. That style of extension has gone out of fashion, and even at its peak, it was really only LeBron James and Kevin Durant using it consistently. Younger players aren’t as fixated on free agency as those two have been. That leaves the two-plus-one and three-plus-one, or perhaps straight three- or four-year deals if Dončić is feeling particularly team-friendly, as our options.

If Dončić were, say, a standard All-NBA player, the three-plus-one would probably be the pick. Security means quite a bit to, say, the 14th-best player in the world. But Dončić is at least the fourth-best player in the world. He’s so good that he can afford to be a bit riskier. It’s just hard to imagine any sequence of injuries in the next few years costing him max offers as a free agent in 2028, so maximizing his earning potential by becoming a free agent after his 10th season is probably his wisest long-term play. Therefore, we’ll treat that as the likeliest answer. But considering it’s the Lakers and considering Dončić has already done some recruiting for them, we can’t rule out the longer three-plus-one format either. If he fully expects to remain with the Lakers indefinitely, he very well could take the longest possible contract as a signal to potential teammates that he’s there to stay. Guaranteeing himself millions of extra dollars wouldn’t hurt either.