How 'dead money' works with the salary cap, and the largest hits ever

March 7, 2024 ndowd

When Russell Wilson is officially released by the Broncos at the start of the NFL league year March 13, the team will take an $85 million hit in dead money against its salary cap over the next two seasons. Why? Because Wilson will have been cut before he even started the five-year extension he signed in 2022, a few months after he was traded from the Seahawks.

Since a significant portion of that extension included guaranteed money, the Broncos are now faced with the biggest dead money charge in league history. In fact, the $85 million hit is larger than the next two closest combined, according to Roster Management System. Denver is expected to spread out the hit over two years– using a post-June 1 designation — with $35.4 million on its cap in 2024 and $49.6 million on its cap in 2025. Those numbers will rank first and fourth when looking at player dead cap charges by year.

As the NFL salary cap has risen over the past decade — it’s at a record $255.4 million per team in 2024, up 13.6% over last year — teams have gotten more comfortable with taking big dead cap charges to get rid of onerous contracts. All of the top 20 charges have come since 2019, when the Steelers took a $21.1 million hit by trading wide receiver Antonio Brown to the Raiders.

What, exactly, is a dead money charge? And which other contracts produced the highest charges ever?

What is a dead money charge?

Here’s the definition, via ESPN national reporter Dan Graziano:

“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.”

Heading into the offseason, each team is allowed to designate two players as post-June 1 releases, which means the franchise can spread out the money of the charge over two years. Here’s more on how it works.

What are the largest dead money charges ever?

Wilson actually makes the top 20 three times when looking at charges by year. That’s because the Seahawks took a $26 million hit when they traded him to the Broncos.

Elsewhere, Matt Ryan cost the Falcons $40.5 million on their 2022 cap when they traded the quarterback to the Colts, and the Packers took on a $40.3 million hit when they dealt quarterback Aaron Rodgers to the Jets in 2023.

Here’s the top 20, via Roster Management System: