Nuggets To Use Stretch Provision On Jonas Valanciunas

The Nuggets will use the stretch provision to spread the $2MM cap charge left on Jonas Valanciunas‘ contract across three seasons, reports Michael Scotto of HoopsHype (Twitter link).

Valanciunas, who has since signed with Zalgiris Kaunas in Lithuania, was waived by Denver last month, leaving the team on the hook for the $2MM partial guarantee on his $10MM expiring contract. Using the stretch provision on that leftover money will result in annual cap charges of $667K for three seasons, reducing the Nuggets’ 2026/27 team salary by $1.33MM.

The move won’t have a major impact on the Nuggets’ salary cap situation. The club will still be operating over the second tax apron by north of $3MM after reducing Valanciunas’ cap hit.

However, the tax savings will be significant. Denver is currently in the fourth tax bracket and is a repeat taxpayer, meaning the team will save $6.75 per dollar in tax penalties by stretching Valanciunas. The move will reduce the Nuggets’ projected tax bill from approximately $84.3MM to $75.3MM.

Of course, the Nuggets are kicking the can down the road a little, adding $667K in dead money to their books for 2027/28 and ’28/29, but they determined that the short-term savings were worth it.

The move will prohibit Denver from re-signing Valanciunas before the end of the 2026/27 league year, though that wasn’t a consideration anyway now that he has decided to play in Europe.

Teams have until the end of August to spread out a player’s 2026/27 salary using the stretch provision. As of September 1, a club won’t be able to adjust a player’s ’26/27 cap hit without a buyout agreement, but could still apply the stretch provision to cap hits in ’27/28 and beyond.