Carlson set career highs with 15 goals and 53 assists in 2017-18 as part of the Capitals' first Stanley Cup Final in 20 years. He added five goals and 15 assists in the playoff run to Washington's first championship. Carlson was the highest-scoring defenseman in the NHL during the regular season and playoffs.
"John has been an exceptional and consistent player for our franchise and has blossomed into being one of the top defensemen in the NHL,'' Capitals GM Brian MacLellan said. "Defenseman like John are a rare commodity in our League and, at 28 years of age, we feel he is just entering his prime. As a right-handed defenseman, John plays in all key situations and has contributed greatly to our team's success on the special teams. We are pleased for both parties to have come to an agreement.''
Carlson has spent his entire career in Washington since joining the franchise as a first-round draft pick in 2008. He has been a consistent part of the Capitals' lineup over the years, appearing in every game in six of his nine NHL seasons.
Carlson has 77 career goals and 256 assists in 608 games. He was an unrestricted free agent after completing a six-year, $23.8 million contract. Carlson's new deal will put him second on the team in AAV behind captain Alex Ovechkin.
"His value is immense,'' goaltender Braden Holtby said. "You can see that, how much he meant to our team in this run. As far as growth, I think he's grown steadily, but I think he's been pretty good for a long time. He's been really good for a long time. I think this year it just showed through a bit more because we just forced him to play more.''
The return of Carlson is the first big move the team has made to retain the core of its Cup-winning squad.
Coach Barry Trotz resigned after he and the organization failed to agree to terms on a new contract. Trotz has since been named the head coach of the New York Islanders.
Washington also traded goaltender Philipp Grubauer and defenseman Brooks Orpik to the Colorado Avalanche. Grubauer began the playoffs as the team's starting goalie before yielding to Holtby. Orpik, 37, was an NHL-best plus-17 in the playoffs this season.
Trading Grubauer and Orpik helped free up the cap space for the Capitals to bring back Carlson, who was seen as the best defenseman available on the free agent market this summer.
The Associated Press contributed to this report.