Key takeaways
- Learn the 2026-27 ladder in order: minimum team salary $148.465m, cap $164.961m, tax $200.428m, first apron $209.015m, second apron $221.686m.
- Treat the first apron as the point where flexibility starts to go: above it a team loses the bi-annual and non-taxpayer mid-level exceptions and the expanded trade-matching rule.
- Treat the second apron as the point where it mostly goes: no salary aggregation, no cash in trades, no prior-year trade exceptions, and a frozen future first-round pick.
- Remember that using certain exceptions hard-caps a team at an apron for the rest of the season, so the order of moves matters.
- Re-check every figure each July: all five levels move with the salary cap, which can rise by at most 10% a year and cannot fall.
The NBA's aprons are two team-salary thresholds above the luxury tax line. For the 2026-27 season the first apron is $209.015 million and the second apron is $221.686 million. A team whose payroll sits above either one loses specific tools for building a roster, and above the second apron it can also lose the right to trade a future first-round pick. The aprons are the top two rungs of a five-rung ladder that runs from the minimum team salary to the second apron.
The figures here come from the league's announcement of 30 June 2026, effective 1 July 2026. The rules come from the 2023 collective bargaining agreement, which runs from 2023-24 through 2029-30, as summarised in the NBA's own "CBA 101" guide. For what a cap, cap space and a luxury tax are in general, salary cap basics for GM games covers the vocabulary. This article is about the NBA's particular version.
The 2026-27 ladder
| Rung | 2026-27 figure | What it means for a team |
|---|---|---|
| Minimum team salary | $148.465m | A team below it at the start of the regular season pays the shortfall, which is distributed to the players |
| Salary cap | $164.961m | Below it, a team can sign or trade for players using cap room; above it, every addition needs an exception |
| Tax level | $200.428m | A team above it on the last day of the regular season pays the luxury tax |
| First apron | $209.015m | Above it, a group of exceptions and trade options is off the table |
| Second apron | $221.686m | Above it, more trade tools disappear and a future first-round pick can be frozen |
The gaps between the rungs are worth knowing because they decide how much room a team has to manoeuvre. In 2026-27 the cap sits $35.467 million below the tax line, the first apron is $8.587 million above the tax line, and the second apron is another $12.671 million above that. All of this is our arithmetic from the league's figures.
How the numbers are set
The salary cap is calculated each year from projected basketball-related income: under CBA 101, 44.74% of the projection, minus projected player benefits, divided by 30 teams. The minimum team salary, tax level and both aprons then move by the same percentage as the cap, and no level may fall from one year to the next or rise by more than 10%.
You can see that rule at work. CBA 101 lists the 2024-25 cap as $140.588 million, so the 2026-27 cap is 17.3% higher two seasons later ($164.961m ÷ $140.588m), less than two maximum 10% rises would allow. The 2024-25 tax line, $170.814 million, scaled by the same ratio, lands within a thousand dollars of 2026-27's $200.428 million.
What each apron takes away
The rule underneath both aprons is simple: a team may not make certain moves if its payroll would be above the relevant apron immediately afterwards. And a team that does make one of those moves may not go above that apron for the rest of the salary-cap year. That second clause is what people mean when they say a move "hard-caps" a team.
| First apron: off the table above $209.015m | Second apron: also off the table above $221.686m |
|---|---|
| Signing or trading for a player with the bi-annual exception | Using a traded player exception generated in a previous year |
| Signing or trading for a player with the non-taxpayer mid-level exception | Aggregating several players' salaries in one trade |
| Acquiring a player in a sign-and-trade | Paying cash to another team in a trade |
| Signing a player waived mid-season whose old contract paid more than the non-taxpayer mid-level amount | Acquiring a player with a trade exception created by a sign-and-trade |
| Using the expanded traded player exception, which lets a team take back more salary than it sends out: up to 200% plus $250,000 on small deals, tapering to 125% plus $250,000 on the largest | Signing a player with the taxpayer mid-level exception |
There is one more interaction to remember. A team that uses the taxpayer mid-level exception may not make any first-apron move for the rest of that salary-cap year.
The frozen pick
The second apron carries a penalty that reaches years into the future. If a team's payroll is above the second apron at the start of its last regular-season game, its first-round pick in the seventh draft after that season is frozen and cannot be traded. For a team above the line at the end of 2026-27, that is its 2034 pick. If the team is above the second apron at the same point in at least two of the next four seasons, the frozen pick moves to the end of the first round. If it stays at or below the line in at least three of those four, the pick is released.
The luxury tax
A team whose payroll is above the tax level on the last day of the regular season pays a tax on every dollar over, charged in brackets of a fixed size. Since 2025-26 the rates for a non-repeat taxpayer start at $1.00 per dollar for the first bracket, then $1.25, $3.50 and $4.75, rising by $0.50 for each bracket after that. A repeater, a team that has paid tax in at least four of the last five seasons including the current one, pays $2.00 more per dollar in every bracket.
The bracket was $5.168 million in 2024-25 and grows at the same rate as the cap, which puts it at about $6.064 million for 2026-27 by our arithmetic ($5.168m × $164.961m ÷ $140.588m); the league's June 2026 release does not state it. A worked example, for a team $15 million over the tax line, which at $215.428 million is also above the first apron:
| Slice of the $15m overage | Non-repeater rate | Tax | Repeater rate | Tax |
|---|---|---|---|---|
| First $6.064m | $1.00 | $6.064m | $3.00 | $18.192m |
| Next $6.064m | $1.25 | $7.580m | $3.25 | $19.708m |
| Last $2.872m | $3.50 | $10.052m | $5.50 | $15.796m |
| Total | about $23.7m | about $53.7m |
The same payroll costs more than twice as much in tax for a repeat offender, so the agreement prices a habit of spending far more heavily than a single expensive season.
How a soft cap is exceeded: the exceptions
The NBA cap is soft: a team over it may still add players, but only through defined exceptions. These are the tools the aprons switch off.
Bird rights
The "Bird" exception lets a team re-sign its own free agent, one who played for it in each of the three previous seasons, for up to the player's maximum salary regardless of the cap. An Early Bird player, with two seasons, can be re-signed for up to the greater of 175% of his previous salary or 105% of the prior season's average salary, on a deal of at least two seasons. A Non-Bird player can be re-signed for up to 120% of his previous salary, or 120% of his minimum salary if that is higher.
Bird rights also bring better terms. A contract with a team's own Bird free agent can run five years and rise by up to 8% of the first-year salary each season, against four years and 5% for a player signed with cap room.
The mid-level and bi-annual exceptions
| Exception (2026-27) | Amount | Longest contract |
|---|---|---|
| Non-taxpayer mid-level | $15.044m | 4 years |
| Mid-level for teams with cap room | $9.366m | 3 years |
| Taxpayer mid-level | $6.064m | 2 years |
| Bi-annual | Not listed in the June 2026 release; it also grows with the cap | 2 years |
The bi-annual exception cannot be used in two consecutive seasons. A team that dips below the cap at any point in a season may use only the room version of these exceptions that year. And since 2024-25, the bi-annual, non-taxpayer and room mid-level exceptions can also be used to acquire players by trade or waiver claim, not just to sign them.
Other exceptions cover first-round picks on rookie-scale deals, second-round picks, minimum contracts, disabled-player replacements and traded-player exceptions. Trade matching is where the first apron bites hardest: a team above it after a trade loses the expanded exception and the $250,000 allowance, so it can take back no more salary than it sends out.
Roster rules that sit alongside the cap
During the season a team must generally carry 14 or 15 players on standard contracts, and may drop to 12 or 13 only for up to two weeks at a time and 28 days in total. It may also hold up to three two-way contracts. These run one or two seasons, pay half the minimum salary for a player with no years of service, and allow the player on the NBA active list for at most 50 regular-season games.
What it means for a front office
Read as a ladder, the system offers a choice at each rung:
- Under the cap: maximum flexibility, using cap room plus the room mid-level exception.
- Over the cap, under the tax: the full set of exceptions, with no tax bill.
- Between the tax and the first apron: the full toolkit, but every dollar now costs tax as well as salary.
- Between the aprons: a contender's zone, with the main exceptions gone and trades limited to taking back no more salary than goes out.
- Above the second apron: a team that has chosen its roster and will have to live with it, while its future first-round pick is put at risk.
That is the same contend-or-rebuild question rebuild vs retool frames, with prices attached, and it explains why free agency looks so different for teams on different rungs.
In Pro Basketball GM Franchise, Salary Cap Draft is one of eight draft formats, and GM Mode covers contracts and trades. Everything above describes the NBA's agreement, not the game's mechanics. What carries over is the habit of asking what a move costs in flexibility as well as in money. The basketball draft simulator guide covers drafting under a cap. More basketball explainers are on the basketball hub, and our management games are in the sports GM category.
Good to know
Frequently asked questions
What are the NBA's first and second aprons?
What is the NBA salary cap for 2026-27?
What happens if a team goes over the second apron?
What are Bird rights?
What is a two-way contract?
Sources
- NBA sets Salary Cap for 2026-27 season at $164.961 million (opens in a new tab)NBA Communications — accessed
- NBA sets salary cap for 2026-27 season at $164.961 million (opens in a new tab)NBA.com — accessed
- CBA 101: Highlights of the Collective Bargaining Agreement (prepared by the NBA, November 2024) (opens in a new tab)National Basketball Association — accessed
- CBA: 2023 NBA-NBPA Collective Bargaining Agreement (opens in a new tab)National Basketball Players Association — accessed
League, team and athlete names appear here only to identify the rules, records and history being discussed. Reign Creative LLC's sports games are not affiliated with, endorsed by or licensed by any league, team, players' association or athlete, and all names and marks belong to their owners.
About the author
Reign Creative LLC — The independent app studio that builds the apps covered on this site and publishes every article here. On Google Play it publishes as Reign Collective Apps.
We use AI tools to help research, draft and edit our articles. Each article lists the sources its factual claims rely on, and details about our apps come from their live Google Play listings. No article on this site has been reviewed by an independent expert unless the reviewer is named on it.
No person at Reign Creative LLC has read this article in full. It was published after automated checks and an AI editorial review, which are described in our editorial policy and are not the same as a person reading every sentence.
Spotted an error? Tell us — how corrections are handled is set out in our editorial policy.