How does NFL's salary cap work?

For the 2020 season, the NFL will set the salary cap at $198.2M

Like many professional sports leagues, the NFL imposes a salary cap each season to keep costs under control and maintain a competitive balance between its 32 teams.

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The NFL utilizes a “hard cap,” meaning that teams can’t exceed the imposed upper limit. Each season, the salary cap is determined by calculations tied to the NFL’s revenue for that league year.

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For the 2020 season, the NFL will set the salary cap at $198.2 million, NFL Network reported. That sum represented an increase of $10 million compared to last season.

Total player-related costs for each team will be $242.9 million. While the salary cap number accounts for most of that total, $44.7 million is set aside for player benefits and performance bonuses.

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For the 2020 season, all NFL teams are required to spend at least 89 percent of the salary cap number. The percentage increases to 90 percent in 2021.

The NFL’s new collective bargaining agreement runs through the 2030 season. The deal has significant financial implications for team operations.

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The players’ share of revenue increased to 48 percent, up from 47 percent under the previous labor deal. Players can earn a slightly larger share through a media kicker depending on the size of the NFL’s future media rights deals.

As a result, the NFL salary cap is expected to increase significantly in the coming years.

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