Below are the two types of salary benefits for veteran players:
Veteran salary benefit: Formerly known as the minimum salary benefit, the veteran salary benefit allow teams to offer a “Qualifying Contract” to any player with at least four credited seasons at a reduced salary cap hit. Under this provision, a qualifying contract is a one-year deal worth the minimum base salary applicable to a player with his number of credited seasons, plus $137,500 in additional compensation (i.e., signing bonus, roster bonus, incentive, etc. — amount begins to increase in 2022). These contracts are charged against the salary cap at the rate of a player with two credited seasons that league year.
Four-year qualifying contract: Another type of veteran salary benefit, it can be offered to a player with at least four credited seasons whose contract with a team has expired after being on said team for four or more consecutive, uninterrupted league years prior to his contract expiring. Such a player must have been on the team’s 90-man active/inactive list for said seasons (and every regular-season and postseason game). Teams can sign a maximum of two eligible players to this type of salary benefit.
A qualifying contract under this benefit is a one-year deal with a base salary of up to $1.25 million more (set to increase in 2022) than the minimum base salary for said player. However, if a team does sign two players to a qualifying contract, it can only give a combined $1.25 million in additional base salary between the two deals. Under such agreements, only the applicable minimum base salary (not the $1.25 million benefit) is charged against the salary cap.