Explaining how the NFL works, Part 7: Dead money

Minnesota Vikings v New Orleans Saints
Photo by Ronald Martinez/Getty Images

Let’s examine the process of some of the inner workings in the NFL and how teams manage the situations.

Whether it’s when the NFL is in the full swing of its regular season or if it’s during the downtime of the early summer, there still is constant news and happenings with the league that has made itself relevant 365 days a year. When various things are discussed, sometimes there are terminologies and procedures where fans might have a general understanding of things. Even the most die-hard fans may have certain areas they don’t understand exactly what various things mean and wish to have a better understanding.

Over the next few weeks, I will take some time to do my best in thoroughly explaining some of the various inner workings of things in the NFL. These are not on-field items but more from an administrative standpoint. Whether it be understanding the waiver wire, the Reserve/Injured List, or the breakdown of the practice squad, we’ll take a look at some of the various terms that are thrown around and utilized in descriptions of things in the NFL but may not be fully understood.

Next up is the topic of dead money, which is even more important on today’s date.

Dead Money

The term dead money, which is used when looking at an NFL contract, is the amount of money which still needs to be accounted for on the salary cap after the player’s contract is no longer in effect. While it would be easier to say it is when “the player is no longer on the team,” that is not always the case which will be explained shortly. Dead money does not mean that the team still owes the player any part of their base salary or other bonuses, it is simply money the player has already been paid but has not been accounted for on the salary cap.

A good example to show the concept of dead money is where the Steelers recently released cornerback Ahkello Witherspoon. Last season the Steelers signed Witherspoon to a two-year deal worth $8 million. The structure of the deal paid Witherspoon $1.035 million in a base salary for 2022, a $2.965 million signing bonus, and a $4 million base salary for 2023. After looking how bonuses worked yesterday, Witherspoon signing bonus was split up to count $1,482,500 each of the two seasons. This kept Witherspoon’s cap number down to $2,517,500 last year and would have been $5,482,500 in 2023. When Witherspoon was released, the $4 million base salary went to cap savings but the additional $1,482,500 that was to go on this year’s salary cap and had already been paid to Witherspoon still counts on the salary cap for 2023 under the category of dead money.

Dead money but still on the team?

So how can a player have a dead money charge and still be on the team? This happens when a player has one contract terminated and then has another begin. The best example of this comes from Anthony McFarland Jr. Because he did not make the Steelers 53-man roster in 2022, he had a dead money hit for his remaining signing bonus. The fact that McFarland was signed back onto the practice squad, or even if he had been signed the 53-man roster at another point, it doesn’t change his dead money hit from the end of his rookie contract which was terminated when he did not make the team.

Void Years

Sometimes teams add void years onto a contract in order to spread out the salary cap hit of the initial signing bonus. A void year is simply fake years on a contract just to spread out the signing bonus but the player does not have a base salary for those years and are set to become a free agent once the contract voids. If a player has void years in their contract and they are not re-signed before the contract voids, all of the remaining money from any of the void years gets transferred into dead money for the next season.

A good example of this is Cameron Sutton. With 2021 being the only year the Steelers have ever used void years because of the salary cap going down, Sutton signed a contract for two years that also had three void years at the end. With a $3.5 million signing bonus, the Steelers saved $1.05 million on the salary cap for 2021 by having the void years at the end of the contract (the prorated bonus was $700k per year with the void years vs. $1.75 million if the contract only had two years). But when Sutton‘s contract voided in February, the remaining $700k from each of the three void years all was transferred as dead money into the Steelers 2023 salary cap and Sutton cost the Steelers $2.1 million this season. Even if Sutton would have re-signed with the Steelers during free agency, this dead money value still would have been there.

June 1

A very important date in the NFL calendar when it comes to dealing with dead money is June 1. If a player is cut or traded after June 1, the remaining dead money can be spread over two seasons instead of one as long as that player‘s contract was set to go this distance or beyond. If the player has multiple years left on their contract, only their prorated bonus for that season will count in the first year and all the remaining prorated bonuses added together would count for the next year. For example, if a player had three years left on their contract with $2 million in prorated bonus each season, they would count $2 million for the upcoming season in dead money and $4 million the following season in dead money if they were released after June 1.

One example of this comes from Stephon Tuitt’s retirement last year which occurred on June 1. By waiting until this date, the remaining dead money for Tuitt was able to be spread out across the 2022 and 2023 seasons.

Using the earlier example of Anthony McFarland, this is why he still has a dead money hit with the Steelers for 2023. Because he was released at the end of August before being signed to the practice squad, his dead money hit was spread out over 2022 in 2023. This is why he still has a $180k dead money hit for the season.

When June 1 isn’t June 1

But what if a team plans on releasing a player but wants to wait until June 1 in order to have the cap savings? Rather than hold that player hostage, teams are allowed to release as many as two players who they designate as a June 1 release although they release them much sooner. This allows the player to sign with any team once free agency begins, and the team can spread out the dead money into the following year (as long as their contract was to go beyond the upcoming season). The only other requirement that comes with this is that a player’s entire salary cap hit must stay with the team until June 1. So if a player has a large base salary, that stays on the team’s salary cap until the release is made official the start of June.

It should also be noted that neither trades nor retirements can be designated as a June 1 transaction. In order to have those benefits, they cannot be officially processed until that time.

Early Retirement

If a player signed a large contract with an extensive signing bonus for many years but then decides to step away from the game early, the only way a team can get around the dead money charge is too try to recoup some of the player’s signing bonus. In order for this to happen, the team and the player have to enter into arbitration. While this is possible, it is not something that comes into play very often, especially with the Pittsburgh Steelers.

In case you missed other parts of the series, they can be seen here:

Steelers Vertex: Is Levi Wallace prepared to hold off the rest of the young cornerbacks?

NFL: Pittsburgh Steelers at Atlanta Falcons
Dale Zanine-USA TODAY Sports

With the inside track to the starting job in Week 1, what level of play does Wallace bring tat others will have to surpass?

The Pittsburgh Steelers 2023 league year is well underway. With the 2023 NFL draft now behind us, there are still questions to be answered going forward. With Joey Porter Jr. taken as the 32nd overall pick, he will be looking to crack the starting lineup as soon as possible. But with Levi Wallace the front runner to start across from Patrick Peterson, what does he bring to the defense that Porter will have to attempt to unseed. This is the subject for this week’s Steelers Vertex.

Let’s get a quick reminder of where this nerdiness is coming from.

Vertex– a single point where two or more lines cross.

Sometimes to make a great point, it takes two different systems of analysis to come together and build off each other in order to drawl a proper conclusion. In this case, the two methods are statistical analysis and film breakdown. Enter Dave Schofield (the stat geek) and Geoffrey Benedict (the film guru) to come together to prove a single point based on our two lines of thinking.

Here comes the breakdown from two different lines of analysis.

The Stats Line:

In his first season with the Pittsburgh Steelers, Levi Wallace appeared in 15 games where he had nine starts. Wallace pulled in four interceptions with the Steelers in 2022 which was a career high. Wallace also had a career high in passes defensed with 13 and also added 48 tackles. When it comes to the advanced stats, Wallace was targeted 77 times with 41 completions for 650 yards and three touchdowns according to Pro Football Reference.

When breaking his stats down more by individual games, Wallace was one of many Steelers defenders that had a much stronger second half of the season. Missing two games in the first half of the season in Week 6 and Week 8. Wallace gave up his most yards in 2022 in the Steelers loss to the Buffalo Bills as he was credited with 109 yards on four completions and a touchdown. But as the season went on, Wallace appeared to find his own with the Steelers. In fact, over the Steelers final three games Wallace only gave up three completions on eight targets for 42 yards and one of his interceptions.

But how did all this look on film?

The Film Line:

Levi Wallace’s start to the 2022 season started with learning a new defense and then adding a knee injury and concussion in the first half of the season. When he was on the field, he looked a bit tentative and slow.

Steelers vs. Bills, 1st quarter, 14:09

Levi Wallace (#29) is the cornerback to the bottom of the screen.

Wallace gives a bit too much ground here to Gabriel Davis, and when Tre Norwood takes a bad angle to help they are both out of the play as the Bills take control less than a minute into the game.

But Wallace still showed his strengths even as he struggled and gave up yards.

Steelers vs. Bills, 2nd quarter, 11:32

Levi Wallace (#29) is the cornerback to the bottom of the screen.

Wallace is very good in trail coverage and he shows that here. He stays physically involved in the route, reading the eyes of the receiver so he can turn and find the ball for his first interception as a Steeler.

Wallace played at least half the game in only 4 of the first 8 games, and yet had some of the worst coverage numbers on the team. His play was good at times and awful other times. That turned around after the bye week, and in my opinion, it all started in the 4th quarter of the Steelers Week 10 matchup with the New Orleans Saints.

Steelers vs. Saints, 4th quarter, 12:22

Levi Wallace (#29) is the cornerback.

This interception for Damontae Kazee was created by a subtle pull on the receiver’s arm that went unnoticed by the referees. Wallace got away with one here, and when the Saints got the ball back, they were looking to attack his side of the field.

Andy Dalton’s first pass of the drive was completed against Wallace, but held short of the first down by a nice tackle.

Steelers vs. Saints, 4th quarter, 8:13

Levi Wallace (#29) is the cornerback to the top of the screen.

Dalton is looking to attack the gap between Terrell Edmunds (jumping to tip the pass) and Minkah Fitzpatrick, but Levi Wallace reads the play and comes across to break up the pass. Wallace is a very good zone corner and shows it here in a cover-3 look, reading the play and getting to the ball in time. A stuffed run on third down would end this drive for the Saints.

The next drive would be the Saints last, starting off with a sack, a pass to Alvin Kamara that Levi Wallace tackled to bring up third and 9, and this play:

Steelers vs. Saints, 4th quarter, 4:30

Levi Wallace (#29) is the cornerback to the top of the screen.

Again in trail coverage, Wallace again stays physically involved in the route, turns with the receiver and finds the ball to turn the ball back over to the offense, and the Steelers would run the clock out.

The final 8 offensive plays of the game for the Saints showed they had targeted Wallace as the weak link in the Steelers coverage, and they went after him a number of times. Here’s the results:

1. Wallace gets away with holding WR arm, Kazee INT.
2. Complete pass held to 9 yard gain by Wallace tackle.
3. Wallace reads play to break up pass
4. Stuffed run on 3rd and 1.
5. Stuffed QB sneak on 4th down.
6. Sack
7. Pass to Kamara cut off well short of first down by Wallace
8. Interception by Wallace.

Levi Wallace seemed to gain confidence from this sequence, and from that point in the season on, he was a much more effective corner.

Steelers vs. Bengals, 2nd quarter, 0:35

Levi Wallace (#29) is the cornerback to the bottom of the screen.

Wallace does a pretty good Joe Haden impression here, jumping the underneath route for a big turnover. The Bengals were looking to score to break the tie at the end of the half, but this play put the Steelers in position to play for a field goal and take the lead.

Steelers vs. Bengals, 3rd quarter, 12:50

Levi Wallace (#29) is the cornerback to the top of the screen.

Here Wallace shows again he can play tight coverage and make plays on the ball. The Bengals went after Wallace in this game, and he responded with one of his best games of the season, allowing less than a 50% completion percentage and a 40.5 passer rating when targeted by Joe Burrow. He also was instrumental in setting the Steelers up to win this game, as these two plays saw the Steelers leading the Bengals and in possession of the ball with 27 minutes left to play. The Steelers offense would fall flat and the Bengals would dominate the end of the game, but Wallace turned in a great performance and teams took notice. While Wallace had been targeted an average of 7 times a game from Weeks 5-13, he was only targeted an average of 3 times a game over the last 5 Weeks.

Steelers vs. Browns, 2nd quarter, 1:24

Levi Wallace (#29) is the cornerback to the top of the screen.

Wallace’s last interception of the season came in the finale against the Browns when he again was in a deep third coverage and read the play to come and make a play in the gap in front of Minkah Fitzpatrick. This was a key moment in the game, as the Steelers had just tied the game and would take the lead and control of the game after this turnover.

The Point:

The strengths of Levi Wallace are pretty clear. He is really strong in cover-2 and cover-3 assignments and does well playing tight trail coverage in man. The Steelers defensive additions of Keanu Neal, Patrick Peterson, Joey Porter Jr., and even Cory Trice point to the Steelers looking to play more press man along with the Cover-3/Tampa-2 they have been using and modifying since Teryl Austin and Minkah Fitzpatrick joined the team in 2019.

The ideal situation for the Steelers is to have Joey Porter Jr. seize the #1 cornerback job sooner than later, but realistically Porter Jr. will have rookie struggles and the presence of Levi Wallace gives the Steelers a sound cornerback that fits what their roster is built to run on defense. Wallace is more than capable of holding down the #2 corner spot across from Patrick Peterson as long as he’s healthy.