Beginning Tuesday, Feb. 17 through 4 p.m. on March 3, teams are allowed to place the franchise or transition tag on a player who is scheduled to become an unrestricted free agent when the new NFL league year begins on March 11.

It may sound simple, but the actual mechanics here a little more complex than meets the eye.

Here’s what you need to know about what can happen between now and March 3:

What is the franchise tag?

The franchise tag is a collectively-bargained tool teams can use on one impending unrestricted free agent per year. Teams cannot use both the franchise tag and transition tag (more on that in a bit) in a single offseason; they have to choose between using one or the other. The franchise tag is more commonly used.

Players who have the franchise tag placed on them receive a guaranteed, non-negotiable one-year contract for the upcoming season if they sign the tender. Often times, the franchise tag is a placeholder for a contract extension, which can be negotiated and signed up until mid-July when a player is on the tag.

There are two different kinds of franchise tags:

Exclusive franchise tag: This prevents a player from negotiating offer sheets with other teams, but costs more than the non-exclusive tag. The salary is determined by whichever figure is higher: The average of the top five salaries at the player’s position during the current year, or 120 percent of that player’s previous salary. This type of tag is rarely used – it’s only been used four times since 2014.
Non-exclusive franchise tag: The much more common tag. Players can negotiate and sign offer sheets with any team once the new league year begins, but the player’s previous team retains the right to match that offer sheet. If they do not match it, that team will receive two first-round picks from the team that signed the player to an offer sheet. The last time a player who had the non-exclusive tag placed on him changed teams was 2000, when the Seattle Seahawks declined to match the Dallas Cowboys’ offer sheet for wide receiver Joey Galloway and received two first-round picks in return. The salary for the non-exclusive franchise tag is lower than the exclusive tag, as it’s determined by the higher figure between: the average of the top five salaries at a player’s position over the last five years applied to the current salary cap, or 120 percent of the player’s previous salary.

The short version: Almost all franchise tags are non-exclusive ones, which cost less but carry a chance – albeit a slim, and exceedingly rare, one – that the player will sign an offer sheet with another team.

The Colts in 2024 used the non-exclusive franchise tag on wide receiver Michael Pittman Jr., then signed him to an extension a few weeks later. That was the first time the Colts used a tag of any sort since placing it on punter Pat McAfee in 2013.

Another option: The transition tag

Teams can also place the transition tag on an impending unrestricted free agent if they decline to use the franchise tag, but want to pull a lever to retain an impending unrestricted free agent.

Like the non-exclusive franchise tag, players can negotiate offer sheets with other teams while on the transition tag. There are two key differences: First, the salary of the transition tag is determined by the average of the top 10 salaries at a player’s position over the last five years; second, if a team declines to match an offer sheet, it does not receive compensation in return. It’s basically a right of first refusal mechanism.

Six players have received the transition tag in the last 10 years: Patriots S Kyle Dugger (2024), Cardinals RB Kenyan Drake (2020), Bears CB Kyle Fuller (2018), Dolphins TE Charles Clay (2015), Browns C Alex Mack (2014) and Steelers LB Jason Worilds (2014).

Of those players, two (Drake and Worilds) played a season on the transition tag (meaning they did not sign a multi-year contract). Dugger, Fuller, Clay and Mack all signed contract extensions; in the case of Fuller, the Bears matched an offer sheet Fuller inked with the Green Bay Packers to keep him in Chicago.

The short version: The transition tag is cheaper than both franchise tags, but teams don’t get anything in return if they decline to match an offer sheet.