The Knicks have been satisfied with Larkin, 22, in the preseason, and will guarantee the $1.67 million on his contract for the 2015-16 season.
The deadline for guaranteeing the third-year option comes at the end of October.
As Knicks president Phil Jackson plans to use significant salary cap space for high-profile free agents in the summer of 2015, he’s been cautious on committing guaranteed money to the payroll. In the preseason, Larkin has averaged 2.5 points and 1.5 assists in 20 minutes per game for New York.
Larkin was the 18th overall pick in the 2013 NBA draft in which he was part of a deal from Atlanta to Dallas. He averaged 10.2 minutes per game as a rookie for the Mavericks in the 2013-14 season. Larkin was an All-ACC player at the University of Miami.
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