Can someone explain salary cap/cap hit?

[budsticky]

Or point me to a site that explains it in plain English. I know if you trade a guy you get hit on your following year's cap based on the remainder of his signing bonus, correct? I put a couple guys on the block and got some bites, but they had too much of a cap hit and not enough value in return to make me go through with the trade. What about if you outright release a player? Does it change if you cut him in season or during the off season? I've definitely got these two guys in mind for the chopping block come the post season but they've got years on their contract which I'd like to not be penalized for (which is why, like I said, I couldn't in good faith pull the trigger on the trade offers I got).

I need to have some knowledge of this stuff because I've got some expensive guys all in their final contract years and based on what I do in the draft I know I'm going to have to try and resign at least one or two of them, or find replacements which will cost as well. Can you shed salary in the off-season by cutting older, under performing, overpaid guys?

Again, if anybody can give a primer on this stuff or point me to something that explains it and doesn't sound like it's written by a lawyer I'd much appreciate it.

[fahrenheit]

So every person has a contract, they are given an amount of money and sometimes a signing bonus, more often then not they are given the bonus.

The contract and bonus is spread out of the years of their contract, and your cap hit (or salary) is the portion of the contract you need to pay for that year. Most contracts are set up where the more years you add on to your contract the more bottom heavy it is (meaning the beginning years are smaller cap hits, but the last few are really heavy).

The penalties you receive is the remainder signing bonus that isn't paid. You are not obligated to pay the remainder of someones contract, but you do have to pay the signing bonus upfront if you cut them. If their cap is ridiculously high and their penalties is lower then the cap hit, then its wise to cut them anyway as you are still freeing up space.

It's really just what you can afford and what you can't, some players will have so a big signing bonus that you won't be able to cut them for years even though they have such a huge cap hit.