EVERY NIL DOLLAR IS TAXABLE!! A lot of athletes are surprised when they file their taxes, or don’t file in some cases, and they get hit with a nice tax bill.

All income from NIL activities is considered taxable income. That includes non-cash compensation. That car you got, those shoes, yes taxable.

What student-athletes often miss:

Self-employment Tax – student-athletes are generally considered independent contractors for tax purposes and receive Forms 1099.

Estimated Tax Payments – waiting until April could mean a bigger tax bill than expected…penalties on top of the bill. SHEESH!

State Taxes – you could owe state tax to a state where you earn income from NIL activities. Maybe a Jock Tax?!

Business Deductions – student athletes may be able to reduce their taxable income by deducting qualified business-related expenses.

Tax is already hard, and trying to tax NIL. Good luck! NIL income creates opportunity, but it also introduces complexity. After you sign an NIL deal it might be best to run it by a tax advisor or CPA. I know a few good ones myself.