Jose Alvarado is declining his $4.5 million player option and intends to sign a new three-year, $14-plus million deal to return to the New York Knicks, sources told ESPN's Shams Charania.
The guard was acquired from New Orleans during the season and had a player option for $4.5 million for next season.
"I'm Home," Alvarado wrote on X, ending his post with a series of orange and blue hearts.
I'm Home 🧡💙🧡💙🧡
— Jose Alvarado (@AlvaradoJose15) June 26, 2026
Alvarado indeed came home on Feb. 5 when the Knicks acquired the Brooklyn native who attended Christ the King High School.
He was primarily a backup behind Jalen Brunson but was on the floor with the All-Star for most of the fourth quarter of the Knicks' 107-106 victory over San Antonio in Game 4 of the NBA Finals, when they made a record comeback from a 29-point deficit. Alvarado had eight points and three assists in the period.
The Associated Press contributed to this report.