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Cap/Tax Question

I keep seeing these two numbers and that teams that exceed the luxury tax # have to pay a one dollar fine per dollar they're over the tax number. That I get. My question is what is the space between the cap and the tax, how do you get to use that money, and is there any penalty for being above the cap but below the tax? As it relates to the Wolves, if they end up signing Batum for the offer they made that will put them over the cap but well below the luxury tax line. Why can't they just do that? There's probably a simple answer to this and if someone could explain it I'd appreciate it.
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