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NIL income may come in many forms, including but not limited to:

  • Ad revenue from personal media accounts;

  • Free products or services received for endorsements;

  • Revenue from televised ads;

  • Income from NIL collectives;

  • Money earned from promotional appearances or public speaking events;

  • Gift cards.

 

It’s important for student athletes to understand what is considered taxable income and what must be included to ensure proper tax filing.  

 

Further, athletes should first ascertain if they are self-employed independent contractors and their status as a dependent on their parents’ tax return(s), as both will impact their annual tax return. Student-athletes should also consider the implications of NIL income if they apply for Free Application for Federal Student Aid (FAFSA). 

 

In general, NIL earners are required to account for state and local taxes in their return. Should they function as an independent contractor, they will have to account for self-employment taxes as well, which have a current tax rate of 15.3% for the first $176,100 of net SE income. Depending on the amount of income earned, student athletes may also be required to file a federal tax return. Under the NCAA’s rule, student athletes should also detail any NIL activities to their school.

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While student-athletes now have a huge financial opportunity by earning NIL income, the IRS has numerous specifications and regulations surrounding such earnings that can be difficult to navigate. Under the NCAA's rule, collegiate athletes are allowed to employ the aid of professional service providers in accounting for NIL income. At Zinman & Company, our team can help you (a) gain a better understanding of your current financials and future financial position, and (b) prepare accurate and timely tax returns - all so you can focus on your educational and athletic careers. ​

Name, Image, Likeness (NIL) Income

College students have the opportunity to earn income by licensing their Name, Image, and Likeness (NIL) under a 2021 rule by the National Collegiate Athletics Association. The rule offers collegiate athletes a means of making money and beginning to create their own personal brand while still in college. This may come in the form of autograph sales, social media, endorsement deals or partnerships with other brands, etc.​

Reporting NIL Income

How We Can Help

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Click here to contact us today to learn more!

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