I’ve seen plenty of questions here about the tax consequences might be for players who start receiving NIL compensation. Here’s a link to the most in-depth discussion I’ve seen so far on the subject, if you’re interested in some answers. (h/t)
Filed under It's Just Bidness
For God’s sake don’t spend it all, kids. You’re high profile and you WILL be audited.
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Great article, and yes, this topic is extremely complex. The recruiting angle especially on state tax is really interesting with a potential pull to no and low state tax states over “high” tax states.
Great. Vandy’s going to cancel on us THIS year because too many of their players will have been arrested by the IRS.
Wonder which tax lawyer will be the first to use a CFB player to advertise?
Ken Nugent for the win…
That’s a good idea, Teach. Get an athlete to tell the others that they need to watch out for taxes, while getting paid. Seems like a natural.
The guys like Young making (a reputed) $1 million a year will have tax attorneys, accountants to help them make the right decision since they will be able to afford it. It’s going to be that kid making a few thousand or a few 10’s of thousands that is the one that are going to get pinched most likely. They will be getting more money than they ever had in most cases, but still not enough to afford professional guidance. Are athletic departments now going to need to add a staff tax advisor to the payroll?
While I am not encouraging anyone to act imprudently, I will say that guys who make a few thousand dollars are not likely to be worth the IRS’ time. It’s a woefully understaffed agency right now. For the most part, it isn’t really difficult math – just get a decent program, set a percentage aside and pay quarterly. Just do it; don’t wait until the end of the year.
Yeah, logically I agree with you. But I’m sure there’s a Jimmy Williamson in the local IRS office looking to make a name by “taking down” these scofflaws.
How long before the states the players have games in as visiting teams initiate a tax like they have on pro athletes?
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Since they are being payed for their NIL NOT for playing the game, that should not be an issue unless they do an appearance for the sponsor in said state. I would bet the farm however that the states will be searching the tax code top to bottom to find a way to tap that revenue stream.
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Was going to say exactly this
Agree with your first sentence. As for the second, I imagine Georgia legislators don’t think that creating a culture where athletes at Georgia colleges get tax bills from other states would be good public relations.
Most P5 programs worth a wooden nickel have staff, or will soon have staff, to help the players with financial guidance. Does any school, just about all of which have accounting/financial degree programs, really want to be the first to have a player brought up on tax charges?
If you don’t think this is part of the official visit spiel, then you’re not paying attention. Kirby’s on the mother.
Are the Athletic Programs allowed to provide Tax Accountants or Attorneys for the players, or is that an impermissible benefit?
Maybe you missed the memo, but the NCAA has basically given up on enforcement.
I see a recruiting advantage for states without a personal income tax. Perhaps Kirby can get the legislature to repel it. 🙂
Heck yes! I’m already repelled by it!
"I don't know if we were awake to start. You know, it was a noon kick.” -- Stetson Bennett, Dawgs247, 9/25/22
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