Report: Steelers Restructure Contract of T.J. Watt, Saving $6.75 Million in 2022 Cap Space

The Pittsburgh Steelers have restructured the contract of outside linebacker T.J. Watt, creating over $6.75 million of 2022 cap space, according to a report by Ian Rapoport of NFL Network.

The #Steelers restructured the contract of pass-rusher TJ Watt to create $6.75M of space, source said. A little operating room before the season.

— Ian Rapoport (@RapSheet) September 7, 2022

The Steelers didn’t have an immediate need for that cap space, as they were under the limit heading into the regular season opener this Sunday, but the team usually likes to give itself a bigger cushion than the slim one it had, in order to have the flexibility to make moves during the season.

By restructuring Watt’s contract, the Steelers converted salary due to him this season into a signing bonus that can be paid immediately, but meted out over the life of his contract for salary cap purposes. The decrease in 2022 salary cap hit will be absorbed as an increase in future years, through the end of his contract in 2025.

Watt was due $24 million in salary this season, so if the total savings reported by Rapaport is correct, the team did not maximize the amount of possible 2022 cap savings, instead choosing to balance the impact between 2022 and future seasons. Watt had $9 million of his salary converted to bonus, with $15 million in salary remaining.

The additional cap space provided by the Watt restructuring should leave the Steelers with approximately $8.5 million in salary cap space entering the season according to OvertheCap.com, well within the historic range of space they have liked to keep in case of emergencies.

When players are injured and go on injured reserve, their salary still counts against the cap, so the Steelers need to have enough available space to both pay those players and go out and get potential in-season replacements. The club will also have to factor in the possibility of practice squad players being game-day elevations, up to three times per player.