The source said there is offset language in the contract, which means that if Tannehill is cut after three seasons, the Dolphins allow another team to pay the balance of the remaining guaranteed money.
The Dolphins apparently made other concessions to make the deal more palatable for Tannehill, who had already missed two practice days of training camp.
Tannehill had been working out with former NFL quarterback Chris Weinke in Bradenton, Fla., while his teammates were at camp.
Tannehill, the No. 8 overall draft pick, is viewed as the quarterback of the future for the Dolphins.
The big, athletic Tannehill is considered a raw talent under center after having played wide receiver for part of his time at Texas A&M.