Hoops Rumors

The salary cap for the 2024/25 NBA league year has officially been set, with the league announcing that the cap will be $140,588,000, a 3.36% increase on last year’s number.

Under the league’s current Collective Bargaining Agreement, the values of the mid-level, room, and bi-annual exceptions are tied to the salary cap and the percentage that it shifts in a given year. Here’s how that math works:

• Non-taxpayer mid-level exception: Worth 9.12% of salary cap.
• Taxpayer mid-level exception: Increases at the same rate as the salary cap.
• Room exception: Worth 5.678% of the salary cap.
• Bi-annual exception: Worth 3.32% of the salary cap.

Listed below are the maximum annual and total values of each of these exceptions, along with a brief explanation of how they work and which teams will have access to them. For more information, check out glossary entries on the mid-level exception and the bi-annual exception.

Mid-Level Exception (Non-Taxpayer):

The non-taxpayer mid-level exception is the primary tool available for over-the-cap teams to add free agents. As long as a team hasn’t dipped below the cap to use cap space and doesn’t go over the first tax apron ($178,132,000) at all, it can use this MLE, which runs for up to four years with 5% annual raises.

In 2024/25, for the first time, this exception can also be used to acquire players via trade or waiver claim.

Mid-Level Exception (Taxpayer):

This lesser form of the mid-level exception is capped at two years and can only be used to sign free agents, not to acquire players via trade or waiver claim. It includes a maximum raise of 5% for the second season.

This exception is essentially available to teams who expect their total salaries to fall between the first tax apron and the second apron ($188,931,000). It’s not available to teams above the second tax apron, so a team that does use it becomes hard-capped at that second apron. A team that uses more than $5,168,000 of its mid-level exception will be hard-capped at the first apron.

Room Exception:

Although this is also a mid-level exception of sorts, it’s colloquially known as the “room” exception, since it’s only available to teams that go below the cap and use their cap room.

If a club goes under the cap, it loses its full mid-level exception, but gets this smaller room exception, which allows the team to go over the cap to sign a player once the team has used up all its cap space.

The room exception can be used to sign players for up to three years, with 5% annual raises. It can also be used to acquire players via trade or waiver claim.

Bi-Annual Exception:

The bi-annual exception, as its name suggests, is only available to teams once every two years. Of the NBA’s 30 clubs, only three – the Cavaliers, Lakers, and Raptors – used it in 2023/24, so they won’t have access to it in ’24/25. The league’s other 27 teams could all theoretically use it this season.

Still, even if a team didn’t use its BAE in ’23/24, that club doesn’t necessarily have access to it for the coming year. As is the case with the non-taxpayer MLE, this exception disappears once a team goes under the cap to use room. It’s also not available to teams over the first tax apron — using the BAE creates a hard cap at that apron.

The BAE can be used to sign players for up to two years, with a 5% raise after year one. It can also be used to acquire players via trade or waiver claim.