The Athletic was informed by an individual familiar with the specifics that Shohei Ohtani’s record-breаking 10-year, $700 million contract contains a number of extraordinary deferrals.

Ohtani agreed to postpone $2 million of his yearly salary—$68 million out of $70 million—until after the contract’s completion so that the Los Angeles Dodgers could keep spending around stars like Mookie Betts, Freddie Freeman, and him. From 2034 until 2043, the money that has been postponed will be paid out without interest.

According to the source knowledgeable on the agreements who spoke with The Athletic, Ohtani personally suggested the previously undisclosed postponements as the amount reached $700 million in discussions. We anticipate that the agreement will be closed soon.

The Dodgers hope that the unconventional structure will provide them more leeway in managing their payroll and financial flow. While all is going on, Ohtani is raking in the dough from sponsorship deals and other off-field endeavors. A source familiar with the matter informed The Athletic that Ohtani reportedly earns $50 million a year when he is not playing baseball.

Additionally, the Dodgers get more leeway in navigating the competitive balance tax, popularly known as the luxury tax, thanks to the deferrals. Individuals informed with the terms have stated that the anticipated average yearly value of the contract, as it pertains to CBT, is approximately $46 million. The previous record-holder was Max Scherzer’s three-year deal with the New York Mets in 2021, which he signed for $43.3 million per year. This new deal, at $46 million per year, surpasses that.

No cap on pay deferrals can be agreed to by either the player or the team, according to the MLB collective bargaining agreement. A net-present-value computation, which estimates the worth of a player’s contract season by season, is also included in the CBA for luxury-tax purposes. So that’s how we get to the $46 million number.

Over the course of his ten-year contract with the Dodgers, Ohtani will earn an average of $46 million year. However, Ohtani is set to earn a whopping $700 million over the whole 20-year duration of the deal. This includes the subsequent 10-year period when the deferrals are distributed, during which he will no longer be obligated to the franchise.

Divided evenly across the two 10-year periods, Ohtani will earn $2 million annually from 2024–2033, and $68 million annually from 2034–2043.

With free-agent right-handers Yoshinobu Yamamoto of Japan and Tyler Glasnow of the Tampa Bay Rays on their want lists, the Dodgers are still among the top teams in the market for pitching.

The previous record-setting contract was signed by Ohtani’s former Angels teammate Mike Trout, who received $426.5 million. Ohtani’s contract was far more lucrative. Upon Ohtani’s announcement of his choice to join the Dodgers, Nez Balelo, an agent with Creative Artists Agency, hinted to the deferral arrangement.

“He is thrilled to start this collaboration, and he designed his agreement to mirror an authentic dedication from both parties to sustained achievement,” Balelo stated in a statement released at the time