Harbaugh's contract goes heavy on incentives in exchange for reduced salary

Michigan coach Jim Harbaugh’s newly signed heavily incentivized contract features a reduced base salary each of the next five seasons and buyouts that appear favorable to both parties.

Under the new contract signed Friday that takes him through the 2025 season, Harbaugh could make a maximum of $7.45 million, less than the just more than $8 million he was projected to make this year, the final year of his original seven-year deal. By Year 5 of the contract, he could make a maximum of $7,901,102.

There are performance bonuses of $3.475 million annually, including $1 million for winning the Big Ten championship, $500,000 for reaching the national semifinals and $1 million for winning the national championship, according to the Memorandum of Understanding obtained Friday.

In terms of buyouts, Michigan would owe him $4 million in 2021 if they part ways and Harbaugh would owe $2 million if he leaves. Michigan’s buyout decreases by $1 million each year, while Harbaugh’s buyout to Michigan decreases in increments of $500,000.

The new contract begins Monday through Jan. 10, 2026.

achengelis@detroitnews.com

Twitter: @chengelis