New NFL Cap Situation to Help Colts With Big Free Agent Decisions

The Indianapolis Colts will work with a little extra cash in the 2026 free agency window after the NFL announced that the league's salary cap will increase to just over $300 million per team. That number represents a $20 million increase from 2025 and a near $100 million increase from 2022.

The NFL’s continued revenue growth, driven by media rights deals, sponsorships, and international expansion, has once again pushed the salary cap upward. For teams like the Colts, who already entered the offseason with moderate flexibility, the increase provides a welcome cushion.

Originally, the Colts were expected to have about $30 million in free cap space in 2026. This announcement boosted the Colts' cap space, leaving the team with about $35 million to work with. A $5 million increase seems minuscule, but it could be much-needed flexibility for a team that has several key free agents set to hit the open market.

With the new salary cap projection for 2026, here's a look at every team's cap space heading into next season 👀💰 pic.twitter.com/L91knWV0mt
— FOX Sports: NFL (@NFLonFOX) January 30, 2026

That flexibility matters the most at quarterback. Daniel Jones is set to become a free agent once again after a one-year stay in Indianapolis, but reports indicate that he and the team want to sign another deal for the near future.

Some projections have Jones being a player worth $40+ million a year, a price tag that could be out of Indy's range. On top of any financial issues, Jones must prove he'll be the same player the Colts saw in the first half of 2025 after rehabbing from a torn Achilles tendon he suffered just over a month ago.

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Jones' injury history is lengthy, and it should be a real concern for general manager Chris Ballard. If you pay a quarterback $40 million just for him to end up on crutches, that would devastate the team's finances and on-field performance all at once.

Daniel Jones is out for the remainder of the game due to an Achilles injury, the Colts announced.

(📺 CBS) pic.twitter.com/UYMLQrboeM
— ESPN (@espn) December 7, 2025

It would make the most sense for the Colts to get Jones to agree to an incentive-based deal that rewards availability and winning. That way, if things go south, the Colts still have some financial freedom in 2027 and beyond.

Bringing back Jones also helps the Colts avoid further volatility at quarterback. Even though they may not be able to pay him more than other quarterback-needy teams, the Colts can offer a surrounding cast that can help Jones reach the postseason for the second time in his career.

Aside from Jones, the Colts must work on a deal with wide receiver Alec Pierce. The former second-round pick just played the final year of his rookie contract, and he had his best season yet.

Pierce was the only Colts receiver to surpass 1,000 yards, and he did it on a mere 47 receptions. Pierce became the first person to reach 1,000 yards with under 50 receptions since DeSean Jackson did it with the Philadelphia Eagles in 2010.

Alec Pierce has been the league's best deep ball receiver over the past 2 seasons. Back to back seasons averaging over 20 yards per reception. Contested catch monster that is insanely explosive

If he gets inside position on a deep ball, it's closer to an 80/20 than a 50/50 ball pic.twitter.com/6oN91NTOq0
— Zach Hicks (@ZachHicks2) January 28, 2026

Pierce is expected to draw interest from teams across the league. He's one of a few true vertical threats who also have a diverse route tree. If Pierce takes the next step, he'll be on the verge of superstar conversations.

Pierce could receive offers upwards of $30 million. The Colts probably can't afford that, but that's why an extra $5 million in cap space helps. It may not seem like much, but any dollar the Colts get can go towards keeping two of their best offensive players on the roster for another season or two.

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