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Name, Image, & Likeness Revisited: Where We Are Now

Tim Shaw  

· 10 minute read

Tim Shaw  

· 10 minute read

The collegiate sports landscape has evolved in the two years since student-athletes have been able to enter into name, image, and likeness (NIL) deals. This article reviews the basics of NIL, how income from such agreements are taxed at the federal level, and recent developments from the National Collegiate Athletic Association (NCAA).

Previously, Checkpoint explored the background of NIL, some tax considerations, and the emergence of so-called NIL collectives—organizations of college boosters and donors that serve as vehicles for NIL activities and compensating student-athletes. For more, see Tax Implications of College Collectives, NIL Deals.


As a result of the Supreme Court’s landmark decision in NCAA v. Alston, 141 S. Ct. 2141 (2021), in June 2021, student athletes can profit from various uses of their name, image, and likenesses. This can range from a variety of sources, such as marketing campaigns, promotional materials, social media posts, and sponsored events. College athletes, historically, are not paid directly as players on their respective teams and unlike players in professional leagues.

Instead, student-athletes make agreements with NIL collectives and not the institutions they attend and play for. These collectives, while affiliated with schools and universities, are independent third parties. Oftentimes NIL collectives are granted status as tax-exempt entities. It has been debated if tax-write offs should be allowed for charitable contributions to tax-exempt collectives. Some lawmakers have taken issue with the nature of NIL collectives and the alleged shadiness of some programs’ recruitment practices.

In the wake of Alston, the NCAA adopted its first iteration of its interim NIL policy on June 30, 2021. The guidance sought to clarify that recruiting conversations between boosters, i.e., collectives, institutions, and prospective student-athletes are expressly impermissible. “The new policy preserves the fact college sports are not pay-for-play,” said NCAA Division II Presidents Council Chair Sandra Jordan at the time. “It also reinforces key principles of fairness and integrity across the NCAA and maintains rules prohibiting improper recruiting inducements. It’s important any new rules maintain these principles.”

May 2022 update reinforced that recruiting inducements are in violation with the interim policy and doubled down on snuffing out performance-based NIL payments. “While the NCAA may pursue the most outrageous violations that were clearly contrary to the interim policy adopted last summer, our focus is on the future,” said Division I Board Chair Jere Morehead. “The new guidance establishes a common set of expectations for the Division I institutions moving forward, and the board expects all Division I institutions to follow our recruiting rules and operate within these reasonable expectations.”

The NCAA says the interim policy will be in place until federal legislation unifying NIL laws for all 50 states is enacted. Until then, the NCAA defers first to state laws, if there are any. At the time of writing, 32 states have passed NIL laws, with some varying degrees of restriction. States commonly prohibit student-athletes from entering into deals for alcohol, tobacco, adult entertainment, gambling, and controlled substances. Some require institutions to provide financial literacy and other informational support, or allow for an agent to negotiate on the student-athlete’s behalf. Alabama notably repealed its NIL law, which was believed to be more restrictive than the NCAA’s policy. Several bills have been proposed at the federal level allowing for collegiate athlete compensation, some reintroduced in multiple sessions of Congress, but none have yet advanced.

Squire Patton Boggs Senior Associate Andrew King told Checkpoint that although the Alston decision was nearly two years ago, “NIL is still in its relative infancy. No doubt the NCAA, as well as institutions, collectives, and other entities in the NIL space are carefully considering the future as NIL rapidly develops.”

NIL & Tax.

On March 7, 2023, National Taxpayer Advocate Erin Collins issued a blog post outlining some tax considerations for student-athletes with NIL deals. First and foremost, as previously reported, NIL income is taxable. Collins wrote that in “most instances,” student-athletes will be required to complete a Form W-9, Request for Taxpayer Number and Certification. In cases when a student-athlete is considered an employee, a Form W-4, Employee’s Withholding Certificate, will also be required.

Collins goes on to explain, though, that student-athletes are, for tax purposes, considered independent contractors. “They will be regarded as self-employed and receive a Form 1099 if their income is more than $600,” Collins said, detailing the following actions that will need to be taken:

  • File a Schedule C, Profit or Loss from Business
  • File a Schedule E, Supplemental Income and Loss
  • Document and track all NIL expenses
  • Remit both the employee and employer portions of the Social Security and Medicare taxes.
  • Calculate and remit estimated quarterly payments

“A student-athlete who files his or her own tax return will have to pay federal income tax if his or her income is more than $12,950 for single filers (or $25,900 if married and filing taxes jointly) since that is the standard deduction for 2022,” Collins continued. “All athletes have to fill out a tax return to report and pay their self-employment taxes if they make at least $400 in NIL activities.”

TurboTax CPA Lisa Greene-Lewis told Checkpoint in an interview that there are ways for NIL earners to save on their taxes. According to Greene-Lewis, many student-athletes “are realizing that their expenses directly related to their NIL work is deductible. A lot of them are influencers, so if they’re shooting videos and bought equipment … they should make sure that they keep track of that so that they can deduct that as well and lower their taxes.” She added that directly-related travel expenses can also be deductible.

Greene-Lewis said that NIL has extended to high schoolers as well and is not just limited to college sports, which can even more-so affect whether a parent or guardian of a student-athlete with NIL income should claim their child on their taxes as a dependent. If a parent is not benefiting from, for instance, education tax credits or something similar for whatever reason—be it income-related or another situation—”the child should make sure that the parent does not claim them so that they could get benefits of the tax credits,” she advised.

For parents seeking to still claim their child as a dependent, Greene-Lewis explained that “kids that are in school full time can be under 24 and they would still be considered a qualifying child, so their income doesn’t come into play when you’re figuring out whether they’re claiming them as independent.” Parents will not be able to claim a child as a dependent if the child is providing over half of their support.

According to Greene-Lewis, crypto received as payment for NIL activities will be taxed as self-employment income. “The income will be reported on a 1099-NEC just like when one is self-employed or on a 1099-K if paid through a third-party provider. If they sell the crypto they received, they will be taxed on any gains from the sale. Their gain or loss will be calculated by subtracting the fair market value of the crypto at the time of receipt from the sales price.”

Updated Guidance.

On October 26, 2022, the NCAA Division I Board of Directors unanimously approved updated guidance to its NIL policy further emphasizing examples of what forms of involvement between schools, boosters/collectives, and prospective or current student-athletes are permissible or impermissible. The new guidance, which went into effect January 1, 2023, also encourages schools to be more involved with providing informational support on NIL-adjacent topics like financial literacy, taxes, social media, and more.

“The board also noted that—when permitted by applicable state laws—schools can and should require student-athletes to report NIL activities to the athletics department,” read a NCAA press release.

Arguably the biggest takeaway from the updated guidance is the NCAA’s approach to enforcing its NIL policy. Under current NCAA bylaws, a hearing panel in cases when available information indicates a violation has occurred will assume there was such a violation unless “the institution or involved individual clearly demonstrates with credible and sufficient information that all communications and conduct surrounding the name, image and likeness activity complied with NCAA legislation.”

William Lawrence of Burr & Foreman wrote that previously, “the NCAA had directed its enforcement staff to review facts of individual cases but pursue only those individual cases that were clearly contrary to the NIL Policy, including the most severe violations of Institutional involvement or pay-for-play.”

The “NIL Presumption,” as it is now colloquially referred to, is regarded by some as a “guilty until proven innocent” standard, as opposed to the core concept of the phrase “innocent until proven guilty.”

“While we are not talking about actual criminal charges in the NIL context, just by way of analogy the new presumption reverses this standard,” said King. “Institutions are now incentivized to cooperate with any NCAA investigation, as the failure to submit evidence or cooperate would hinder their ability to show they did not commit an infraction. Institutions should carefully review their internal policies and work with staff, collectives, and student-athletes on understanding the import of this change.”

First NIL penalty.

In February, the NCAA handed down its first NIL-related punishment. At issue was a dinner hosted by prominent University of Miami booster John Ruiz to help recruit star basketball players and social media influencers Haley and Hanna Cavinder—or the Cavinder Twins—to the school’s women’s team at the behest of its coach, Katie Meier.

Reportedly, Meier met Ruiz at a university event and went about connecting the wealthy donor with the Cavinder Twins, who agreed to meet over dinner to discuss the possibility of transferring to the University of Miami. The dinner was made public knowledge through a social media post online, which is where the NCAA found out about it and deemed it in violation of its bylaws for impermissible contact, improper publicity, and atmosphere of compliance.

Meier was suspended for three games at the beginning of the 2022-2023 season. University of Miami’s women’s basketball program was also handed down a one-year probationary period, a $5,000 fine plus 1% of its budget, reductions in the number of official visiting and recruiting days.

King said the penalty is “not binding precedent,” but it remains to be seen how it influences future infractions, especially since the case was processed before the NIL Presumption went into effect despite the penalty being resolved after by the independent Committee on Infractions. “That said, it could serve as a guidepost for any future penalties arising from similar conduct.”


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