The Boston Red Sox were hit with a modest financial penalty on Friday, as it was announced that the team has to pay $1.5 million for going over the Competitive Balance Tax threshold.

The Sox can certainly afford that, and they were one of nine teams who were hit with a penalty, joining the Los Angeles Dodgers, New York Mets, New York Yankees, Philadelphia Phillies, Texas Rangers, Toronto Blue Jays, San Diego Padres and Houston Astros.

While the Red Sox paid just $1.5 million, the Dodgers had to pay $169.4 million. They won the World Series.

Why were the Red Sox hit with a penalty?

The CBT threshold for 2025 was set at $241 million. The Red Sox' final payroll was $248.9 million. Basically, the Red Sox went about $8 million over that number, and therefore were taxed at 20 percent on that $8 million. That is about $1.6 million, but the Red Sox were given a small credit according to the Associated Press.

The Red Sox were under the threshold in 2024, meaning they were labeled as a first-time offender. Each time a team gets under the threshold, the penalties reset. Which leads us to...

What does it mean for the future?

Well, if you go over the penalty a second straight year, you are hit with harsher penalties, so the Red Sox will certainly be aware of their spending into 2026.

The Sox have big money invested in starting pitcher Garrett Crochet, who has his contract extension kick in this season, and Trevor Story, and they also have given extensions to Roman Anthony and Kristian Campbell. If the Red Sox are to go out and sign Alex Bregman or Bo Bichette - or trade for Ketel Marte - they will certainly be at risk of going over for a second straight year.

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Should this fear impact the Sox?

No.

The Red Sox have the financial muscle to flex and they should use it - as long as they think they can win. After getting to the playoffs in 2025, the Red Sox have that chance to win in 2026. Crochet is among the best pitchers in the sport, Aroldis Chapman is still a dominant closer, and Anthony looks like a future MVP. 

Boston has questions in its infield, for now, but they look good on paper. Fear of financial penalties shouldn't dissuade them from spending more. Adding Bregman, Marte or Bichette would go a long way toward making this team even better in a crowded American League East.

What's next?

The business of baseball is likely to shut down between the Christmas holiday and New Years, so the Sox have some pressure to get something done before the holidays. We'll see if they do.

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