dead cap in the nfl
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NFL Contract Dictionary – What is Dead Cap Money?

The NFL offseason is full of draft speculation, trade rumors, and a ridiculous amount of “fancy” contract terms that can be quite confusing. Understanding ” dead cap ” and other financial NFL terminology will make the football chatter sound less like a foreign language.

This article will list out and define all terms related to NFL contracts and answer questions like “what is dead cap money ? “

What does Dead Cap mean in NFL?

Imagine a scenario where your team signs a star player to a massive contract with a hefty signing bonus. That bonus is typically spread out over the length of the deal for salary cap purposes. But what happens if that player underperforms and you need to cut them before their contract is up?

This illustrates a dead cap hit…..

Dead Cap is any guaranteed money remaining on the player’s contract (signing bonus installments, guaranteed salary, etc.) after he is cut from the team. That remaining guaranteed money will count towards the team’s salary cap and would be “dead cap” .

Dead Cap Vs Dead Money

Simply put, the “dead cap” is the the space allotted to cut player contracts within the salary cap. “Dead money” is the actual money paid out . The terms are pretty similar and could be used interchangeably.

dead cap in nfl

NFL Contract Definitions

The NFL throws around a lot of terms that can leave fans scratching their heads.

Here’s a list of some key contract concepts:

  • Unrestricted Free Agent (UFA): A player with at least four seasons under their belt and an expired contract. They can freely negotiate and sign with any team.
  • Restricted Free Agent (RFA): A player with three seasons played and an expired contract. Their current team has the right to match any offer sheet they receive from another team.
  • Dead Money/Dead Cap: Money a team allocates against the salary cap for a player who is no longer on the roster, but has guaranteed money remaining on their contract (like signing bonuses). It’s basically “wasted” cap space that season.
  • Signing Bonus: A lump sum of money paid upfront to a player as part of their contract. It’s enticing for players, but creates dead money if they’re cut before the contract ends.
  • Base Salary: The yearly amount a player is paid, not including bonuses.
  • Franchise Tag (Exclusive): A team can designate one player a UFA as an exclusive franchise player. This forces the player to play for them that year on a one-year contract at a specific value (usually the top average salary for their position). The player can’t negotiate with other teams.
  • Franchise Tag (Non-Exclusive): Similar to the exclusive tag, but the player can negotiate with other teams. If another team signs them to an offer sheet, the original team has the right to match it or let the player go (and receive compensation).
  • Guaranteed Money: A portion of a player’s contract that the team is obligated to pay, regardless of roster status (often includes signing bonus and some salary).
  • Cap Hit: The total amount of money a player’s contract counts against the team’s salary cap in a given year. This includes base salary, signing bonus (spread out over the contract), and any guaranteed money for that year.
  • Offset Language: A clause in a contract that allows a player’s new team to subtract any guaranteed money they receive from their old team’s salary cap hit if they’re released.
  • Veteran Minimum: The minimum salary a player with a certain amount of experience can be paid according to the NFL’s collective bargaining agreement.
  • Contract Incentives: Bonuses a player can earn for achieving specific performance goals during the season (yards gained, touchdowns, etc.).