3 Simple Ways the Nuggets Can Gain Cap Flexibility This Offseason

The Denver Nuggets are in need of some salary cap flexibility. Here's how they can make it happen.

Jan 29, 2026; Denver, Colorado, USA; Denver Nuggets center Jonas Valanciunas (17) reacts in the second half against the Brooklyn Nets at Ball Arena. Mandatory Credit: Ron Chenoy-Imagn Images | Ron Chenoy-Imagn Images

The Denver Nuggets enter this offseason with some big financial decisions on their hands. 

As their cap sheet currently stands, the Nuggets are about $16 million over the luxury tax line. They're $12 million over the first apron, and right above that dreaded second apron line by just over $200,000.

The Nuggets are primed to make some cost-cutting moves around the edges this summer to help offer some better cap flexibility.

Especially with a restricted free agent like Peyton Watson hitting the market, Denver is all but certain to make adjustments to drop their total payroll down––and some could be significant. Combine that with Denver's historical hesitance to pay the tax, getting under that line might be one of the key focuses of this offseason entirely.

Without imploding the entire rotation, though, let's break down three simple ways that the Nuggets could shed some salary off the books over the course of this offseason:

1. Release Jonas Valanciunas

Sep 29, 2025; Denver, CO, USA; Denver Nuggets player Jonas Valanciunas (17) addresses the media during media day at Ball Arena. Mandatory Credit: Isaiah J. Downing-Imagn Images | Isaiah J. Downing-Imagn Images

The writing is on the wall for this one. Considering Jonas Valanciunas is on a non-guaranteed $10 million contract for next season, that can save Denver $8 million against the cap by releasing him. It’s a perfect way for the Nuggets to alleviate some financial pressure they're currently up against.

The Nuggets could also trade Valanciunas for a returning asset and avoid that $2 million cap hit, which would save even more money. And considering he had a productive season in limited minutes last season, maybe that potential trade isn't out of the realm of imagination.

But if no offer can be found on the market, it makes the most sense for Denver to cut ties with him rather than hold onto his expiring deal for one more season.

2. Trade Cameron Johnson

Oct 25, 2025; Denver, Colorado, USA; Denver Nuggets forward Cameron Johnson (23) shoots during warmups before the game against the Phoenix Suns at Ball Arena. Mandatory Credit: Christopher Hanewinckel-Imagn Images | Christopher Hanewinckel-Imagn Images

Trading an impactful starter like Cameron Johnson would be a much tougher move than cutting ties with Valanciunas.

But considering where Denver is in terms of their luxury tax standing and the pending paydays on the horizon for Peyton Watson and possibly Spencer Jones, it could lead to a hard decision being made on Johnson’s future, and ridding of his $23 million salary for next season in a cap-saving deal.

If the Nuggets wanted to keep Johnson on for next season along with the rest of their starters and also pay Peyton Watson a deal upwards of $20 million per season, Denver would be looking at a combined $204 million on the books between all six players.

Something's got to give. And if a bold shake-up surrounding Jamal Murray or Aaron Gordon isn't exactly the most favored outcome, Johnson becomes the clear odd man out to potentially get shipped off.

3. Accept Jalen Pickett's Team Option

Jan 22, 2026; Washington, District of Columbia, USA; Denver Nuggets guard Jalen Pickett (24) looks on during the second half against the Washington Wizards at Capital One Arena. Mandatory Credit: Daniel Kucin Jr.-Imagn Images | Daniel Kucin Jr.-Imagn Images

Signing Jalen Pickett to another season might not look like a cap-saving move on the surface. But while a small domino to fall within the Nuggets' offseason, Denver could save a few bucks by bringing him back.

Pickett's got a team option worth $2.4 million for the 2026-27 season. The projected minimum salary for a veteran with two years of NBA experience sits at $2.57 million, with that number gradually increasing for every season of service up to 10+ years.

Simply put, re-signing Pickett will give the Nuggets a rostered player for around or more than $100,000 less than what they would add via the free agent market.

It's not much, but it does give Denver marginally more flexibility that could help against the luxury tax––so there's no doubt that this front office will keep that in mind.

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