The NBA announced Sunday that the salary cap is set at $140.588 million for the 2024-25 season.

The league said the Tax Level will be $170.814 million.

Both figures go into effect at 12:01 a.m. ET on Monday.

Teams are allowed to begin negotiations with free agents at 6 p.m. ET on Sunday. Signings can become official Saturday.

The NBA said the minimum team salary is set at $126.529 million for the 2024-25 season. For teams that exceed the tax, the First Apron Level is $178.132 million and the Second Apron Level is $188.931 million.

Also, the Mid-Level Exceptions were set at $12.822 million (non-taxpayer), $5.168 million (taxpayer) and $7.983 million (room under salary cap).

The NBA operates under a salary cap system designed to promote competitive balance among its 30 teams while ensuring financial stability across the league. This salary cap is a cornerstone of the NBA's economic structure, dictating how much teams can spend on player salaries each season.

Unlike the "hard" caps in some other professional sports leagues, the NBA employs a "soft" cap, which provides teams with greater flexibility through various exceptions and allowances.