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Cutting Peyton triggers $16 million acceleration

File photo of Indianapolis Colts quarterback Peyton Manning calling a play during NFL's Super Bowl XLI football game in Miami

Indianapolis Colts quarterback Peyton Manning calls a play during the second quarter of the NFL’s Super Bowl XLI football game in Miami, Florida, in this February 4, 2007 file photo. Manning was cut by the Indianapolis Colts after a 14-year stint with the franchise that included a Super Bowl win and four National Football League MVP awards for the quarterback, the team said on March 7, 2012. REUTERS/Mike Blake/Files (UNITED STATES - Tags: SPORT FOOTBALL)


By releasing quarterback Peyton Manning, the Colts avoided paying Peyton Manning $28 million in cash, as well as carrying a $17 million cap charge in 2012.

Per a source with knowledge of Peyton Manning’s contract, cutting him results in $16 million in dead money.

It comes from the $20 million signing bonus Peyton received in August. With a five-year deal, $4 million was charged to the cap in 2011, and the rest remains.

Because the new league year hasn’t begun, the Colts can’t divide the $16 million over two seasons. Instead, the full $16 million hits their cap in 2012.

UPDATE 5:10 p.m. ET: The contract shows that the Colts absorbed a $5.6 million cap charge in 2011, representing one-fifth of the $28 million option bonus that never was paid. So they’ll get a credit against the $16 million acceleration, making the net cap hit $10.6 million.