MLB insider hints Yankees learned the right lesson from DJ LeMahieu disaster contract

One of the biggest impediments to a more active New York Yankees' offseason has been the $15 million charge against the luxury tax they'll be taking while paying DJ LeMahieu not to play for them in 2026.

It's hard not to see the parallels between the Cody Bellinger negotiations and what transpired between New York and LeMahieu following the 2020 season. Both LeMahieu (in his prime) and Bellinger had similar skill sets featuring superb defense, some positional versatility, and low strikeout rates while also carrying some questionable underlying metrics with regard to quality of contact.

They were both top priorities for the Yankees during their respective free agency tours. In breaking down the Bellinger negotiations, the New York Post's Joel Sherman hinted that the Yankees may have learned from what ended up being a foolish gamble with LeMahieu.

Since Sherman's post, we've learned that he was right. The Yankees didn't cave at the prospect of lowering the tax hit by extending Bellinger's deal for seven years (or more) and nabbed their man at their five-year line in the sand.

Yankees learned their lesson from the DJ LeMahieu debacle, but they're still paying the price

As Sherman notes, the Yankees tried to lower LeMahieu's AAV, and thus the tax implications, by extending his deal to six years over the more prudent choice of a four-year deal for the then-31-year-old second baseman.

At a $15 million AAV, the six-year, $90 million deal provided seemed more palatable than paying a couple more million per season over a shorter term at the time, but what really happened was the 2021 Yankees robbing their future selves to save a few bucks then, while paying more now.

Because they didn't stick to their guns, instead of a $32.5 million tax hit for Bellinger in 2026, the club will have $47.5 million go against the books thanks to their desire to save some pennies with their former second baseman.

Taking the hard line with Bellinger will help, but the damage has already been done. There was a point in time where these elongated contracts were New York's standard operating procedure (see Hicks, Aaron), and the Yankees dove into this bag of tricks again last offseason with Max Fried.

The other top free-agent starters at the time, Blake Snell and Corbin Burnes, settled for five and six years, respectively. The Dodgers used deferred money to lower Snell's AAV from $36.4 million to $31.3 million. The Diamondbacks did something similar to reduce the hit for Burnes from $35 million to $32.9 million. The Yankees? They gave Fried two more years than Burnes got, despite the lefty being a year older, in order to lower his AAV to $27.3 million without any deferrals.

It doesn't take a fortune teller to predict that the last two or three years of Fried's deal will end poorly, continuing this cycle of dead money against future payrolls to save a few present-day tax dollars.

It's refreshing to see the Yankees not cave to Bellinger while also resisting their past instincts that have led to these follies, but until all the longer-than-needed deals of the past expire, they'll get hit from both sides, paying higher AAVs going forward while navigating the dead money of the past.