Why Cody Bellinger’s $162 million contract will cost Yankees much more than expected

Cody Bellinger will cost the Yankees more toward the luxury tax payroll in 2026 than Aaron Judge — a lot more.

There are intricate rules in the collective bargaining agreement that have a near poison pill type impact for the Yankees when it comes to Bellinger.

For example, whether Bellinger re-signed or not, the Yankees were going to be charged $3.8 million toward the 2026 payroll in a “true up” from his now completed contract. And due to the front-loaded shape plus opt-outs in his recently signed five-year, $162.5 million deal, a “valley charge” provision means that his 2026 salary will be $44.75 million toward the luxury tax payroll. Thus, Bellinger will count as $48.55 million in total for the 2026 season for luxury tax purposes. Judge — the highest paid Yankee ever in total dollars and annual value — costs $40 million each year for luxury tax purposes.

The Bellinger contract projects the Yankees payroll for luxury tax payroll beyond $330 million for the 2026 season, which would be a record for the franchise. Hal Steinbrenner has consistently said he wants to bring the payroll under $300 million, but even with a trade of, say, Jazz Chisholm Jr. ($10.2 million), they would not get close to that level. The Yankees luxury tax payroll in 2025 was a franchise record of approximately $320 million, which cost an additional $61.8 million in tax.