Honestly, trying to figure out the Washington Wizards salary cap situation right now feels a bit like trying to solve a Rubik's Cube in the dark. You think you’ve got one side matched up, and then a trade like the Trae Young blockbuster happens and resets the whole board. It’s wild. Most fans see the big numbers and assume the team is stuck. But if you actually look at the books for the 2025-26 season, the reality is way more interesting.
The Wizards are currently operating in a weird "in-between" space. They aren't quite the bottom-feeders they were a couple of years ago, but they aren't exactly title contenders either. They're basically a high-ceiling project with a very expensive engine.
The Trae Young Factor and the $154.6 Million Ceiling
The NBA set the salary cap for the 2025-26 season at $154,647,000. That's the magic number. If you're over it, you're using exceptions. If you're way over it, you're hitting "aprons" that make it almost impossible to trade or sign anyone.
Right now, the Wizards have roughly $161 million committed to their active roster.
Wait.
If the cap is $154 million and they're at $161 million, they're over, right? Technically, yes. But here's the kicker: they are still about **$30 million below the luxury tax threshold** of $187.8 million. This means that while they don't have "raw" cap space to just go out and sign a max free agent, they have massive "functional" flexibility.
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The biggest chunk of that change is going to Trae Young, who is pulling in about $45.9 million this year. He’s the centerpiece. Everything the Wizards do with their money from here on out is about building a wall around Trae so he doesn't have to carry the entire offense on his back every single night.
Why the Jordan Poole Trade Still Lingers
You've probably heard the chatter about the Jordan Poole trade. It's been a disaster for some, a lucky escape for others. When the Wizards moved Poole to the Pelicans in exchange for CJ McCollum (who was then flipped for Trae), they essentially cleared a long-term headache.
Poole is still owed nearly $34 million for the 2026-27 season. By getting that off the books, the Wizards avoided a massive "albatross" contract that would have handcuffed them during the prime years of their young core.
The Rookie Scale: Washington’s Secret Weapon
While the stars get the headlines, the real story of the Washington Wizards salary cap is the sheer volume of high-value rookie contracts. This is where the team is actually "winning" the financial game.
Look at these numbers for the 2025-26 season:
- Alex Sarr: $11.8 million (The #2 pick is starting to look like a bargain if he hits his defensive ceiling).
- Tre Johnson: $8.2 million.
- Bilal Coulibaly: $7.2 million.
- Bub Carrington: $4.6 million.
When you have four or five guys playing legitimate rotation minutes for less than $10 million each, you can afford to pay a superstar like Trae Young. It’s the "Rookie Scale Bridge."
The Wizards are basically betting that at least two of these guys become All-Stars before their rookie deals expire. If that happens, Washington will have "Bird Rights" to re-sign them, allowing the team to go way over the cap to keep the talent together.
The Khris Middleton Question
Then there's Khris Middleton. He’s making $33.2 million this year on an expiring contract.
He’s 34.
He’s had some injury bugs.
He’s also the ultimate trade chip.
Because his contract expires at the end of the 2025-26 season, any team looking to "clear their books" for the 2026 free agency class will be calling the Wizards at the trade deadline. Washington can essentially "sell" that $33 million of cap relief to another team in exchange for more draft picks or a younger player who fits Trae Young’s timeline.
Dead Money and the Ghosts of Front Offices Past
NBA caps are never perfectly clean. There’s always some "dead money" hanging around like a ghost. For Washington, this includes:
- Marcus Smart: About $14.7 million in dead cap hit after his buyout.
- Blake Wesley: $3.3 million.
- Dillon Jones: $2.2 million.
It's annoying, sure. Nobody likes paying $20 million to players who aren't on the court. But in the grand scheme of a $154 million cap, it’s a manageable tax for the mistakes of previous seasons.
Looking Ahead: The 2026 Salary Cap Explosion
If you think this year is interesting, just wait until the summer of 2026.
The Wizards are projected to have nearly $80.9 million in "raw" cap space opening up once Middleton and other veterans fall off the books. That is enough to sign two maximum-contract players.
However, there’s a catch.
The Wizards won’t actually have that much money if they decide to keep their own free agents. Cap holds are a thing. If they want to keep a guy like Justin Champagnie or Anthony Gill, they have to "hold" a portion of the cap for them.
What This Means for You (The Actionable Part)
If you're a fan or a cap-geek trying to predict the next move, stop looking at the total payroll and start looking at the trade exceptions.
The Wizards have several trade exceptions—like the $13.4 million Kelly Olynyk exception—that expire in July 2026. These are basically "gift cards" that allow them to trade for a player without sending salary back.
Here is what to watch for in the coming months:
- The February Trade Deadline: If the Wizards aren't in the top six of the East, expect them to move Khris Middleton. They won't let a $33 million expiring contract just walk away for nothing.
- The "First Apron" Hard Cap: Because of certain trades, Washington is "hard-capped" at the first apron ($195.9 million). They cannot exceed this under any circumstances this season. They have plenty of room ($34M+), so don't believe any rumors about them being "stuck" or unable to take on salary.
- The Draft Pick Protections: Keep an eye on the Knicks. They own Washington's 2026 first-rounder if it falls outside the top 8. This affects how much the Wizards might "invest" in the roster late in the season. If they're hovering around the 9th or 10th worst record, the front office might choose to stay flexible (and maybe lose a few more games) to keep that pick.
The Washington Wizards salary cap isn't a prison; it’s a toolkit. They have the star, they have the rookies, and they have the expiring contracts to change the shape of the franchise overnight.