The Celtics officially signed Jrue Holiday to a four-year extension worth $135 million on Thursday, a move that will keep the guard under contract through the 2027-28 season. Holiday turned down a $37.3 million player option for next year to agree to a modest pay cut that will give him more long-term security in Boston.

The new deal ensures Boston will be able to retain their top-six core for at least one more season ahead of their title run during the 2024 postseason. However, the length of the deal for the 34-year-old poses questions as hefty paydays loom for Boston’s other stars. So where does that leave Boston for the future? Here’s a closer look at the implications of Holiday’s contract and a few tricky but welcome issues it could create down the line.

SHORT-TERM IMPACT

The Celtics officially have the ability to run it back next season with no drama heading into the offseason. After Holiday signed his new deal, the best remaining unsigned free agents Boston has on their roster are Luke Kornet and Xavier Tillman. Both of those bigs aren’t going to break the bank (if the team wants them back) but the uncertainty of the offseason fades now for the team’s core.

If Holiday had declined his player option, the Celtics would have potentially sweated out the free-agent market with a couple of East playoff teams (Orlando, Philadelphia) having the cap space and positional need to make a run at Holiday. Instead, the Celtics eliminate that drama (and the possibility they would have no reasonable means to replace Holiday if he departed) by offering him a long-term deal. Holiday gave up some short-term money ($7 million) to secure an outsized payday for himself in the twilight of his career. Just how well the 34-year-old ages remains to be seen but it’s a very real possibility he will be overpaid for his protection in a few years, whether he’s still playing in Boston or somewhere else.

The move makes sense though for the Celtics on a variety of fronts though. Holiday has sacrificed a lot this year (numbers wise) so taking care of him sends a strong message to the team’s core and other players around the league. There’s also the cost-benefit savings for next year since Holiday’s roughly 20 percent paycut in his salary will translate to $35 million in luxury tax penalty savings for next year.

Chances could happen this offseason to this roster’s core if the team suffers an ugly unexpected playoff exit. Barring that, this deal makes it easier for the front office to run it back.

WHAT ABOUT DERRICK WHITE?

White still remains under contract for one more year at a team-friendly number ($19.6 million) but the two sides already had extension negotiations last summer and are likely to do so again this offseason. The fair question is now whether there is enough money left for a long-term deal after the new Holiday pact.

Naturally, there’s less urgency for Boston to get a deal done with White right away given his contract situation versus Holiday (who could have become a free agent this summer). However, it’s clear that White’s market value should only be going up after a breakout year in Boston as he enters his prime. If White is holding out for max earnings, it’s fair to wonder whether even the max extension Boston can offer him is enough to lock him in.

Ultimately, the looming question here is going to be settled by White’s priorities. A team-friendly extension would certainly get done this offseason if he’s open to it but would he be willing to take it if there’s a possibility he could be dealt down the road during a luxury tax crunch looming ahead of the 2025-26 season. Only Boston’s ownership knows what type of payroll they will be able to handle at that point just as super max deals kick in for Jayson Tatum and Jaylen Brown.

HOW LONG CAN THIS
CORE STAY TOGETHER?

The new CBA was created to punish the big spenders, both in team building and with the wallet. Boston’s roster is currently constructed where the team building punishments are manageable. If everyone that matters is already under contract, the ability to add free agents or make unbalanced trades matters a lot less.

However, the repeater tax penalties the Celtics are on pace for after this Holiday deal are unprecedented. Big spending teams like the Warriors and Clippers have paid over $100 million in tax for the past couple of years. Currently, the Celtics’ payroll (if White re-signs) for the 2025-26 season would be on pace to cost over 300 million in tax penalties alone. Boston’s ownership can posture all they want but that’s a spend no one is expecting to occur for obvious reasons.

With that said, that’s a problem for down the road and potentially a solvable one for Boston. There are simple solutions to the issue (let Derrick White walk?) or complicated ones (move Jaylen Brown’s deal?). Signing team-friendly movable mid-tier contracts (Holiday, Porzingis) help the cause as well since if Boston does ultimately need to dump salary, these guys should still have value on those deals rather than Boston needing to attach assets to move the money.

Ultimately, it’s impossible to guess now which direction the team will go in when this bill becomes due since it’s so dependent on how this team performs this year and next year. A couple of titles may make ownership more open to spending more or make decisions easier about the most integral parts of the supporting cast.

Either way, the Celtics are well positioned to make a strong push with this core for at least one more year and stay atop the East.

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