How much money does college sports generate? With ticket sales, sponsorships, broadcast rights, and marketing, the NCAA makes well over $1 billion per year in revenue. For a long time the NCAA brought in these profits without having to compensate the athletes that are on the fields and courts tirelessly putting in the work. After the game-changing ruling by the Supreme Court in 2021, the NCAA suspended the ban that prohibited college athletes from being paid for their own name, image, and likeness.
It all sounds good - the merch, cars, and party appearances until it's time to file the taxes...
Winston CPA Group: specializing in tax and financial education around NIL deals for student athletes.
What do NIL deals & taxes mean for NCAA Athletes?
How much money does college sports generate? With ticket sales, sponsorships, broadcast rights, and marketing, the NCAA makes well over $1 billion per year in revenue. For a long time, the NCAA brought in these profits without having to compensate the athletes that are on the fields and courts tirelessly putting in the work. After the game-changing ruling by the Supreme Court in 2021, the NCAA suspended the ban that prohibited college athletes from being paid for their own name, image, and likeness.
Name/image/likeness deals, also known as NIL or endorsement deals, have become very popular recently for student athletes. A typical NIL deal involves a business or brand partnering with student athletes where they get paid to wear merch, sign autographs, or be featured in the brand's ads. Some college athletic programs made headlines with ground-breaking NIL deals with student athletes. Bryce Young at Alabama, Myles Brennan at LSU, and D'Eriq King at Miami are some of the college football players who signed the biggest NIL deals ranging from thousands of dollars to almost seven figures!
Others aren't too happy with how NIL deals have impacted recruiting - especially in college football. Former buddies Nick Saban and Kirby Smart had a few small words for each other over the name/image/likeness debate. College football recruits have made headlines for committing to a school then de-committing to join programs that have more hype and of course more money-making opportunities.
Are schools paying student athletes to come and play sports? What about their education? Some might say it changes the complexion of college sports with athletes choosing schools based on their ability to bring them name/image/likeness opportunities.
As a student athlete or parent of a student athlete, this post will answer the questions you have about name/image/likeness deals. While it can be an exciting time for student athletes finally making money off their talents, it's important to understand what you're getting into financially. I became a CPA to empower my community through financial education. As a business manager and CPA for professional athletes, I combine my love for sports and accounting to support athletes of color as they navigate this new money.
Sharing this information with you is important to me because I want you to be informed and understand the "fine print" before you sign any endorsement deals. I also understand how hard it is to find accurate and reliable information so please also share this post with your teammates; parents, please share with other athlete's parents.
Let's get into the details of name/image/likeness deals including cash vs. value, taxes, the hype, and how NIL deals can impact your scholarship eligibility.
Nikki Winston, CPA is the founder of The Winston CPA Group where she specializes in financial education, business management, and tax planning for student and professional athletes. Connect with Nikki online on WCG's website, Instagram and Twitter.
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