In July 2015, MLS introduced Targeted Allocation Money (TAM). The concept was straightforward: each club received $500,000 over a five-year period ($100,000 annually) to strengthen rosters in a growing league, while maintaining a level of consistency and fairness for each team. This number was raised to $800,000 in 2016, then $1.2 million last season. Clubs now have an option to use an additional $2.8 million in TAM for the next two seasons.
Although there is a league-wide salary cap, teams can spend an unlimited amount of money on up to three Designated Players, then they may use available TAM to spend on additional players that would otherwise put them over the cap.