Every year around this time, I publish an article about the salary cap. I do it because a lot of offseason plans are being suggested by in “mock” free agency based on widely reported but poorly understood salary cap numbers.
Most NFL fans don’t understand the salary cap — and for a very good reason; most sports writers don’t understand the NFL salary cap and don’t know how to report it meaningfully. As a result, national reporters, local reporters, radio show hosts and bloggers will take a “snapshot”
look at the cap on a given day and report cap space as if it were a solid number carved in stone.
The salary cap is anything but carved in stone for most NFL teams. Despite the salary cap seeming to be a simple concept, it is one of the most complex and least understood aspects of the NFL roster construction.
Like tax law, the NFL salary cap rules are based on commonly accepted accounting principles, but the application of those principles can often be applied in non-intuitive ways to achieve specific outcomes via manipulation of what’s allowed, often contravening the intent of those rules.
Australian retirees
Let me illustrate what I mean by briefly by referring to an odd and counter-intuitive aspect of Australian tax law (at least, the law as it was when I lived in Oz 20 years ago). An Australian citizen who retired under the tax laws that I was familiar with around the turn of the century might have reasonably thought that it would be a good idea to arrange for a lifetime pension from his or her retirement fund (called a ‘superannuation fund’ or ‘super fund’ in Oz) at the time he or she retired. But, because of the vagaries of arcane tax laws, that person would have missed the opportunity to reduce taxes, and would thus have ended up getting less actual money in the bank in retirement.
The crazy truth is that most Aussies retiring at that time (and maybe today, too, I just don’t know if the law has changed or not) would reduce their overall taxes and increase the net amount of their pensions by making the maximum tax-free withdrawal from the superannuation fund on the day they retired, then turning around and contributing all that money back to the super fund the following day. It doesn’t make any common sense, but that was the effect of the various Australian tax laws. A retiree who visited a financial planner to help with retirement would probably have had this explained, while anyone who didn’t get professional advice would probably have missed the opportunity to significantly increase the money available in retirement.
NFL salary cap
Similar to this example of the apparent inanity of Australian tax law, the NFL salary cap often seems arbitrary to the extent that many sports commentators, writers and fans declare that the cap “isn’t real”.
I can assure you that the cap is very real, but, like Generally Accepted Accounting Principles (GAAP) that apply to businesses around the world, the rules provide for a lot of flexibility. Some see this flexibility as a shortcoming of the salary cap system. It is, in fact, a feature. The salary cap puts all the teams on an even playing field in that they all have the same amount of cap space over any given period of time, but it allows for the kind of elasticity and flexibility that allows GMs for all teams to make adjustments as needed to create or maintain talented rosters, increasing competitiveness across the league, which is a good thing.
Estimates change all the time
Cap space estimates are exactly that — estimates. They are also only as current as the most recent data base entry made by Spotrac or Over the Cap — the two primary sources for fans to keep track of the salary cap.
About a year ago, in early February of 2025, I wrote this in an article about salary cap:
Less than a week ago, Over the Cap estimated Washington’s available cap space to be $87.5m for 2025, but, as always, that number is not written in dried concrete.
Yesterday, the number had dropped to $78.1m as factors like player bonuses and future contracts were factored in. And the estimated available cap space will continue to be updated as new data is incorporated between now and the start of the new league year in mid-March.
Since the Commanders are not in the playoffs this year, the 2026 cap situation is a bit more settled than the ’25 cap situation was at the end of January last year, but all cap space estimates have to be understood to be written not in dried concrete, but in wet sand.
For example, all estimates right now are based on the projection of a league-wide salary cap of $295.5m, but the actual number has not yet been announced by the league. When it is, the specific projection for all teams will increase or decrease by the same amount, but the relative position of each team will not change (in other words, if the Commanders are currently projected to have the 6th most cap space, they will still have the 6th most space after the league announces the actual amount of the league wide cap).
The ‘snapshot’ issue
I mentioned once already that sports writers tend to look at the salary cap at a point in time and report the ‘snapshot’ view of the cap at that time, failing to go any deeper or understand the dynamic nature of the cap.
This is a disservice to NFL fans who rely on the headline information that they hear on ESPN or read in The Athletic, and it leads to a lot of confusion among NFL fans when cap space that was reported in February headlines turns out to be very different from the cap space available to teams in March.
Eample: The annual “Cowboys are in cap hell” claims
The Dallas Cowboys are, rightfully, one of the most-disliked teams in the NFL, and opposing fan bases often gleefully report the latest verbal gaffe by Jerry Jones or any seeming misstep by the Dallas front office. For several years now, it has been an annual tradition for writers and fans across the nation to proclaim that the Cowboys are in “cap hell” and unable to sign free agents or re-sign their own players.
Every year, those writers and fans are wrong because they don’t realize what the Cowboys are doing with their biggest multi-year player contracts.
A glance right now at Over the Cap shows that Dallas is expected to be $39m over the cap this offseason, which seems like a disaster.
But it’s not. It’s the result of a deliberate strategy by Jerry Jones to manipulate the cap in a way that he believes will be to the Cowboys advantage.
Jerry is constructing contracts that are intended to deal with two rules:
- Signing bonuses can be pro-rated, but only for 5 years or the duration of the contract, whichever is shorter.
- Player base salaries (Paragraph 5 salaries) can be converted to signing bonus by the team at any time.
At the time that Dak Prescott signed his most recent extension — a four-year, $240 million deal signed prior to the 2024 season — the extension, which covered ‘25-’28, included void years out to 2032, even though every one of the void years was an empty vessel at the time of the contract signing. That extension also featured massive base salaries ($40m, $45m and $55m in the next three seasons) and eye-watering cap hits ($74m, $68m and $78m in ‘26, ‘27, ‘28).
The Cowboys never intended for those base salaries to stay in place or for the team to absorb the cap hits on that schedule.
Under Rule 1 above, any signing bonus paid to Prescott at the time the contract was signed in 2024 could not be pro-rated beyond 2028.
To get around this restriction, the Cowboys plan to convert nearly all of Prescott’s base salary to signing bonus annually, which allows them to push the proration out beyond 2028 — with signing bonus proration eventually getting pushed all the way out to 2032.
For example, last year, the Cowboys converted $45.75 million of Prescott’s salary in 2025 to a signing bonus. The move lowered his 2025 cap number by $36.6 million and increased his cap number by $9.15 million in each of the next four seasons, including 2029.
I guarantee you that the Cowboys will do much the same thing before mid-March this year. Jerry Jones will convert around $38m of Prescott’s salary to bonus, which will improve the Cowboys 2026 cap position by about $30m.
CeeDee Lamb’s contract is structured the same way. So is Tyler Smith’s deal. The same with Osa Odighizuwa, DaRon Bland, and Jake Ferguson.
When Jerry Jones presses the button to execute this planned cap strategy, the Cowboys 2026 cap situation will look completely different.
By simply executing the six restructures that the Cowboys built into past extensions with their own players (assuming all 6 player remain on the roster for ’26), the Cowboys will free up over $89m in 2026 cap space, which would change the current $39m cap deficit into about $50m in cap space available for free agency.
If Jerry Jones decides to do the same with two players acquired in 2025 trades — Quinnen Williams and Kenny Clark — he can free up roughly an additional $21.2m, meaning that the Cowboys could enter free agency over $70m in cap space!
I can just about guarantee that you’ll be reading commentary from national sportswriters and NFL fans in the next few weeks about the Cowboys untenable cap position. Those reports will come from a reliance on the current ‘snapshot’ from Over the Cap and Spotrac without taking into account the dynamic nature of the NFL salary cap; the flexible construction of player contracts; and the strategic planning of NFL front offices.
What do we need to know about the Commanders 2026 cap space?
I’d say that the first rule of projected cap space is to understand that what you read on Spotrac or Over the Cap is based on good information, but it is not a true reflection of where teams will actually be when free agency starts — and I don’t just mean that teams will be able to change cap space by cutting players (though that is part of the dynamic)
One: The current cap space projection is only a starting point
In the Dallas Cowboys example above, the current projection of a $39m cap deficit faced by Jerry Jones is only the starting point. It is not at all indicative of the cap resources Jerruh will have at his disposal on the first day of the new league year (March 15).
While the specifics are different, the Commanders current projected 2026 cap space of $63.4m is only a starting point.
Two: Deebo’s contract matters a lot
Fans are divided over whether Deebo Samuel should be back on the team in 2026.
If he is extended, it’s difficult to project the value, length or structure of his contract.
But, if he is not extended, then Deebo’s contract holds an unpleasant $12.34m surprise.
When Deebo joined the Commanders via trade last season, Adam Peters re-did Deebo’s contract, which only ran to the end of the ‘25 season. Among the changes that were made, 4 void years were added.
The conventional practice in the NFL is for voids to be triggered on the 5th day of the new league year (which would be March 20th this year), but the practice in San Francisco has been to trigger on April 1st — a practice that I know the Commanders used in at least one player contract in 2024. I’m not sure of the date for Deebo’s contract, but some time probably between March 20th & April 1st, his contract will void if not extended, resulting in an immediate cap hit of $12.34m.
The effect would be to cut the Commanders available cap space from $63.4m to about $51m. For anyone who is trying to sketch out an offseason plan for the Commanders, that $12.4m is a hugely significant change to be aware of.
Three: End-of-season adjustments
An often-overlooked aspect of NFL salary cap dynamics is end-of-season adjustments. These can result from a range of issues, but I think the most common and generally most significant adjustments come from contract bonuses. Cap hits are adjusted downward for players who fail to achieve bonuses that were deemed likely to be earned and upward for players who achieve bonuses that were deemed unlikely to be earned.
Until all the adjustments are made, it’s impossible to know the effect, but experience tells me that the Commanders projected available cap space usually shrinks between early February and mid-March when the adjustments are applied.
Heading into the final two games of the season, Jacob Martin, Deebo Samuel and Von Miller all had the potential to hit key incentive bonuses. As far as I know, Miller was the only one of the three to do so; he earned $1m by totaling 9 sacks for the year. That $1m will likely reduce the Commanders projected available cap space for 2026.
Similarly, Marcus Mariota earned $200,000 for every win in which he took at least 60% of the snaps. The Raiders game and the Week 15 game against the Giants both qualify, which means that Mariota will be paid an extra $400,000 for starting and winning those two games.
Four: Trades and releases
Nearly every NFL fan is aware that the salary cap is affected by trades, releases and retirements. If a contract is highly leveraged (i.e., lots of dead cap due to remaining years, guaranteed money or void years) then the available cap space can be adversely affected, but most teams will make a number of roster moves that are designed to increase available cap space by moving on from an under-performing player.
Marshon Lattimore
The Commanders traded for Marshon Lattimore at the 2024 trade deadline, acquiring a cornerback that was expected to help them in the ‘24 playoffs and then play a key role in ‘25 and ‘26.
It has not worked out. Since Lattimore has no guaranteed money left on his contract, the Commanders can free up $18.5m in cap space as long as they release or trade him before March 15th, when a $2m roster bonus is due.
Daron Payne
Opinions are much more divided on Daron Payne, who has a $28m cap hit in the final year of his contract.
Some fans believe he has underperformed, and would be very happy to see him released or traded, resulting in a $16.75m increase in available cap space.
Others think that the team should make an effort to renegotiate or restructure Payne’s contract so that he stays, but with a much lower cap hit.
Still others are happy to keep Payne on his current deal. Some think he’s playing well; others don’t think there’s a realistic opportunity to get a better player at the same cost, and other fans just don’t see the sense in creating one more hole in the Commanders defense that has to be filled before September.
Ben Standig recently said that he believes the team is leaning towards keeping Payne and letting him play out the final year of his contract.
Five: Restructures
As was obvious in the Cowboys example above, one oft-used conventional method for managing cap space in the NFL is to restructure contracts by converting base salary into signing bonus, thus shifting cap charges from the current year to future years.
I have read comments from some people that said that the Commanders weren’t “all in” on the 2024 season because the team didn’t use all of its available cap space.
In fact, they did…depending on how you look at it.
It was recently reported that the Commanders have the 2nd-most salary cap rollover ($23.87m).
If the Deebo Samuel contract had not been re-structured, $12.4m of that amount would have been charged to the 2025 cap instead of the 2026 cap, which would have reduced the rollover to around $11.5m.
The last contract signed with an then-current player last year was the Terry McLaurin extension, which was signed just a couple of weeks before the start of the season. In that contract extension, $13.75m of Terry’s 2025 base salary was converted to signing bonus, resulting in a cap savings of $11.3m.
Without these two contract adjustments (Deebo & Terry), the Commanders would have effectively spent all of their 2026 cap space despite having had a reported available cap space of $78.1m on February 3rd, 2025.
The restructures were needed to ensure that Washington would have sufficient cap space to sign injury replacements during the year, and the NFL’s rollover policy means that there is no penalty for teams that create excess space as long as they comply with minimum cap spending requirements of the CBA.
It’s hard to know whether the Commanders will want to ‘create’ 2026 cap space by re-structuring any contracts, but if they do, there are some obvious candidates. I mentioned Daron Payne above. Laremy Tunsil is expected to sign an extension, which may lower his 2026 cap hit similar to the extension signed by Terry McLaurin last year. A Sam Cosmi restructure could open up around $11m in cap space if void years were added to his contract. About $8m could be found by restructuring Javon Kinlaw’s deal and adding void years. Frankie Luvu, Dorance Armstrong and Tyler Biadasz also offer opportunities for cap savings through restructures or extensions.
Bottom line
Despite the many headlines that you will read over the coming days and weeks that will proclaim that the Commanders have cap space of around $63m based on the Over the Cap estimate, we know that, absent a contract extension, Deebo Samuel’s contract will void by April 1st, cutting that estimate to around $51m immediately.
You will commonly see sports writers and fans suggesting that the Commanders will cut cut Marshon Lattimore, resulting in cap space of around $81.5m available for free agency. This number does not take into account the $12.4m hit for Deebo’s contract, and it does not take into account the end-of-season adjustments that take place every year for contract incentives like Von Miller’s sack total or Marcus Mariota starting games that the Commanders won.
Without a doubt, the Commanders have a lot of available cap space and a lot of open roster spots. However, the amount that Adam Peters will have available to spend isn’t likely to be the oft-quoted $81.5m. It is much more likely to be a maximum of $70m (after Deebo’s contract voids and Lattimore is released), and probably even less than that after accounting for end-of-year adjustments.
When you work on your off-season free agency plans, keep in mind that cap space is a moving target, and any plan to spend cap dollars requires you to look ahead to see what’s coming.
