5:13 PM ET

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CINCINNATI -- The Bengals have picked up the fifth-year option for quarterback Joe Burrow, the team announced Tuesday.

The transaction comes ahead of the May 2 deadline for teams to exercise such options for the first-round picks in the 2020 class. According to projections by OverTheCap.com, Burrow's fifth-year option will land him $29.5 million in fully guaranteed money for 2024.

The move comes as the Bengals and Burrow have been engaged in discussions regarding a contract extension for the top overall pick in the 2020 draft.

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"This is a mechanical step along the way and we will continue to work with Joe and his representatives to secure his long-term future as a Bengals," the team said in a statement.

Since arriving in Cincinnati, the former Heisman Trophy winner and LSU standout has played an instrumental role in flipping the franchise's fortunes.

In the 2021 season, one year after he suffered a season-ending knee injury that ended his rookie season, Burrow helped the Bengals win their first playoff game in more than three decades. The Bengals went on to win their first AFC title since 1989 and fell short of securing their first Lombardi Trophy in a 23-20 loss to the Los Angeles Rams in Super Bowl LVI.

Cincinnati lost in the AFC title game in a rematch against the Kansas City Chiefs to end its 2022 season. However, Burrow enjoyed his best year in the NFL. Burrow finished 10th in Total QBR and third in completion percentage over expectation, according to ESPN Stats & Information research.

He was named to his first Pro Bowl, which earned him approximately $6.3 million extra salary on his fifth-year option.

At the NFL scouting combine in late February, Bengals director of player personnel Duke Tobin said the timing of Burrow's extension remained uncertain.

He noted that it could be the first or last deal to get done at a time when the Bengals have notable players such as wide receiver Tee Higgins and linebacker Logan Wilson who are eligible for contract extensions.

"Obviously, sooner is better," Tobin said. "But we're not going to rush the process. We're going to try to get the right deal for Joe and for the Cincinnati Bengals."

ESPN's Jeremy Fowler contributed to this report.