What Is Dead Money In The NFL?
With the flurry of players being released, signed, or traded there have been many contracts negotiated. So with that in mind, now is a good time to talk about what is dead money in the NFL. It can be a complicated topic depending on the terms of a particular contract. But I’ll try to keep things short and simple. Dead money is the salary cap space a team must allocate to a player who has been released. Or, it’s the amount of money that needs to be accounted for on the salary cap after the player’s contract is no longer in effect.
Furthermore, check out the explanation provided by Dan Graziano of ESPN:
“A dead money charge is a charge on an NFL team’s salary cap for a player who is no longer on the roster. It represents any remaining signing bonus proration that was not accounted for prior to the player’s release or trade. It is not a cash payment but rather a cap charge. Resulting from the the rule that allows teams to prorate a signing bonus evenly over as many as five years. If a player is released prior to the end of those five years, all remaining signing bonus proration accelerates onto the team’s salary cap for the current year.”
As I said it can be complicated, but it also emphasizes the importance of contract negotiations. If the player doesn’t meet the team expectations they will want to cut the player. However, depending on the contract they may end up with a huge cap hit. And that could cripple a team in years to come, making it more difficult to sign other players.
What Is Dead Money In The NFL?
A good example of that is the Denver Broncos’ contract with Russell Wilson. After two years they released him. However, now they will take the largest dead money cap hit in NFL history. It will cost them a total of $85 million over two years because they marked Wilson as a post-June 1 release. The good news for the Broncos is that the NFL announced the 2024 Salary Cap will be $255.4 million. That should help ease the burden.
So ideally teams want to ensure the players will meet or exceed expectations before signing them. But since no one can predict the future there will always be risks involved. I’m all for players securing their bags. But teams have to make sure they don’t break the bank.
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