National Football League

Awaiting extension from Cowboys, Dak Prescott restructures deal to create cap space

Updated Mar. 18, 2024 11:56 a.m. ET

Dak Prescott is helping out the Dallas Cowboys as he still awaits a long-term extension from the team.

Both sides agreed to rework the quarterback's contract for the 2024 season, converting a $5 million roster bonus into a signing bonus, ESPN reported Monday. With the move, Prescott's cap number for the upcoming season was lowered to $55.455 million, opening $4 million in cap space for the Cowboys.

However, the restructure also adds two more void years to Prescott's contract, giving him four void years total that run through the 2028 season. Prescott is entering the last season of his deal, so if the two sides are unable to agree to a new deal and the star quarterback leaves in free agency next offseason, the void years will count as a dead cap hit for the Cowboys.

The contract restructure doesn't preclude the two sides from negotiating an extension. With the addition of two more void years, the Cowboys could be more incentivized to get a deal done with Prescott to avoid having dead cap charges for the foreseeable future as they also work to keep a few other notable names in Dallas.

The Cowboys have been quiet in free agency in part because of looming paydays for All-Pro receiver CeeDee Lamb and star pass rusher Micah Parsons, the 2021 NFL Defensive Rookie of the Year.

Committing to Prescott beyond the coming season would make it easier to get deals done with Lamb and Parsons.

The only addition for Dallas from another team so far is linebacker Eric Kendricks on a one-year deal worth up to $3.5 million. The Cowboys added Kendricks while releasing linebacker Leighton Vander Esch, their 2018 first-round pick, on a failed physical designation after another neck injury last season.

Prescott and the Cowboys have both said that they aim to get an extension done this offseason, so he isn't playing in a contract year, which isn't too frequent for an established starting quarterback. The Cowboys have done that twice in the past though with Prescott, giving him the franchise tag twice after his rookie deal expired before agreeing to a four-year, $160 million deal in 2021.

Earlier in March, Prescott was optimistic that the two sides would agree to an extension.

Should Cowboys fans be worried about a potential Dak extension?

"I'm definitely confident," Prescott said on his contract situation. "Obviously, it helps the team. It's important for the numbers. I think I've heard Jerry [Jones] say that. … It is a process. Both sides understand that. Everything's great.

"It'll happen."

Jones seemed hopeful that an extension will get done at some point as well, telling reporters at the combine that he doesn't "fear" the 2024 season being Prescott's last in Dallas. But the Cowboys owner didn't seem to place great urgency on getting a deal done in the coming months, either.

"We don't need to [extend Prescott's deal], but we can if everybody wants to solve it," Jones said on Friday. "You can get in and get on the same page and see if you can come to an agreement. If you can't, what we have in place works. And so obviously, if you do it one way, you'll be working through some of the other areas on the team in a different way, but you can't really plan on that until you see when you're there."

The 2024 season could serve as a make-or-break year for Prescott and head coach Mike McCarthy. In the three seasons that Prescott has finished the year healthy playing under McCarthy, the Cowboys have had a disappointing end to the season in the playoffs. Last season might have been the most disappointing finish of them all, losing to the Green Bay Packers by multiple scores to become the first team to lose to a seventh seed in the playoffs.

Still, the 30-year-old Prescott arguably played the best football in his career in 2023. He had career-bests in completion percentage (69.5) and passer rating (105.9) and threw for the second-most yards (4,516) and touchdowns (36) in his eight-year career. He earned second-team All-Pro honors as a result.

Following the restructure, the Cowboys now have a little less than $9 million in cap space, according to OverTheCap.com.

The Associated Press contributed to this report.