All the rage in recent weeks when it comes to the Seattle Seahawks has not been the one and done playoff appearance for a second time in three seasons. It has not been the half dozen 2020 starters set to be free agents or retire. And it hasn’t been whether the team would take advantage of a franchise or transition tag prior to the deadline next Tuesday at 4 PM New York Time. It has been the rumors and reports regarding the potential for franchise quarterback Russell Wilson to be traded. Maybe. Possibly.
However, regardless of one believes a trade to be a mere possibility that has a very slim chance of happening, or whether one believes it is a near certainty, if a trade were to happen there would, of course, be ramifications that have hit the cap.
Personally, I’m of the opinion that Wilson will not be traded*, but there is enough chatter regarding the possibility, no matter how remote, that discussing the cap implications is inevitable. So, those cap ramifications are to be discussed here without consideration for the likelihood, or improbability if one prefers to look at it that way, of Wilson in fact being traded.
*Now that this has been put in writing, it probably guarantees he is dealt.
So, without wasting any time, here is what Wilson’s 2021 cap hit looks like if he is on the roster:
- 2021: $32M cap hit (this is $19M base salary plus $13M in the 2021 portion of his signing bonus)
In contrast, if Wilson is traded this year, the team would take on $39M in dead money, though the timing of the dead money hitting the team’s salary cap would be dependent on when he is traded. The possibilities for the timing of a trade and the relevant cap impact are as follows:
- Trade executed on or before 6/1/2021: $39M dead cap charge in 2021
- Traded executed 6/2/2021 or later but prior to 11/2/201 at 4 PM New York Time: $39M dead cap, of which $13M goes on the 2021 cap and $26M goes onto the 2022 cap
Now, the question asked in the post Thursday that the Seahawks are actually fielding calls from other teams regarding a possible trade for Wilson is whether there is anything Russell and the team can do to restructure his contract to reduce that amount. That answer is technically yes, but in reality it is extremely unlikely.
The reason for this is understanding the origins of the $39M in dead money that the team would be forced to recognize. Specifically, that dead money constitutes three fifths of the $65M signing bonus Wilson received, and the only way for a team to reduce the dead cap from a signing bonus that has already been paid is for the player to pay back a portion of the signing bonus. This idea was touched on in a PFF post by Brad Spielberger Thursday when he wrote about the possible mechanics of such a move.
One possibility to get around this massive financial burden could be a maneuver that was also discussed by former Jets general manager and Dolphins executive vice president of football operations Mike Tannenbaum with Wentz. Wilson, if he truly wants out that badly, could cut a check for about $20 million to pay back signing bonus money to Seattle before the first day of the 2021 league year on March 17.
The Seahawks would get salary-cap relief in that amount on their books in 2021, turning the dead cap charge into $19 million, the same amount Stafford left behind in Detroit. Then, the new team Wilson moves to could pay him a signing bonus in that exact amount, and he is made whole while Seattle has a substantially smaller dead cap charge.
This might seem like a logical way for the dead money matter to be addressed, but using this methodology creates certain tax headaches. Specifically, Wilson has likely already paid the necessary income tax on the $65M signing bonus he received in 2019, however, the payback of $20M would have to be paid from after tax income. Then, the $20M that would come from the new team would be taxed as ordinary income, and Wilson’s tax guy would then be required to file a whole bunch of paperwork with the IRS to straighten things out.
The Seahawks have used a similar mechanism at least a pair of times in the past. The most notable of these is, of course, was with Malik McDowell and recovering a portion of his signing bonus, which allowed the team to avoid recognizing the recovered amount against the cap.
In any case, at the end of the day, if the Seahawks trade Wilson on or before June 1, the net impact on their salary cap is an increase of $7M. So, while the overall amount of dead money - $39M - is large in an absolute sense, it is not prohibitive from the standpoint of preventing a trade because the net effect is manageable. That, of course, does not necessarily make it desirable, but from a functional standpoint it is a possibility.
The next question then is the matter of how the Hawks would create the necessary $7M in space, given that they are effectively bumping up against the 2021 cap given the assumptions on where the final number is expected to land. That is where things get interesting because the Seahawks manage their salary cap extremely conservatively. If this were the Philadelphia Eagles or the New Orleans Saints, John Schneider would simply slap a few void years on the back of the contracts of Tyler Lockett and Carlos Dunlap and in a matter of minutes the team would have more than plenty of cap space to do what it wants. However, because the Hawks have tended to be less aggressive when it comes to managing their cap, exactly how they will go about creating the necessary space remains anyone’s guess.