How to Make NIL Money as a Student-Athlete

Name, Image, and Likeness (NIL) refers to the commercial use of a student-athlete’s name, photograph, or athletic reputation. NIL allows collegiate athletes to earn compensation from third parties for promotional activities, enabling them to monetize their personal brand.

Understanding NIL Eligibility and Regulations

Student-athletes must understand the rules governing NIL activities. These regulations stem from the National Collegiate Athletic Association (NCAA), state laws, and individual university policies. State laws often have specific provisions that supersede or add to NCAA guidelines.

The NCAA emphasizes that institutions cannot directly pay student-athletes for their NIL. Payments must come from third parties for services rendered, such as endorsements or appearances. NIL compensation must not be connected to athletic performance or enrollment decisions, ensuring NIL activities do not become a pay-for-play system.

State-level NIL laws often require student-athletes to disclose NIL activities to their universities. These laws generally prohibit universities from preventing athletes from engaging in NIL activities. However, restrictions may apply, such as endorsements conflicting with university sponsorships or promoting regulated products like gambling or alcohol.

Individual university policies define the scope of permissible NIL activities. These policies detail reporting requirements, restrictions on using university trademarks or logos without permission, and limitations on NIL deals during academic or athletic activities. Non-compliance with institutional rules could lead to eligibility issues.

Identifying NIL Opportunities

Student-athletes can generate income through various NIL opportunities. Common opportunities include social media endorsements, where athletes promote products or services to their followers, and autograph sessions or personal appearances at events. Athletes can also monetize their brand through merchandise sales, or by offering private lessons and camps in their sport.

Building a strong personal brand is important for attracting NIL opportunities. This involves cultivating a positive public image and engaging with fans on social media. A consistent online presence enhances an athlete’s marketability to potential partners. Authenticity and genuine interest in the products or services being promoted resonate effectively with audiences.

Networking within the local community and leveraging connections can lead to NIL deals. Businesses seeking to reach specific demographics may approach student-athletes directly for promotional activities. Specialized NIL agencies and marketplaces have emerged to connect student-athletes with brands. These platforms can help athletes identify opportunities and negotiate compensation.

When considering opportunities, student-athletes should evaluate the impact on their time, academic commitments, and athletic obligations. While financial gain is a motivator, balancing these demands is important for success. Prioritizing opportunities that align with personal values and long-term goals contributes to a sustainable and fulfilling NIL journey.

Navigating Compliance and Reporting

After an NIL opportunity is identified and an agreement reached, student-athletes must navigate the university’s compliance and reporting process. This involves gathering specific information for disclosure to the athletic department’s compliance office or designated university platform. Key details include the compensation amount, all parties involved, the nature of the NIL activity, and the duration of the agreement.

Universities provide specific disclosure forms or online portals for submitting NIL deal information. These resources are accessible through the athletic department’s compliance website or directly from compliance officers. Accurately completing these forms requires attention to detail, ensuring all requested fields are filled out. Some universities may also require a copy of the written agreement.

The submission method for completed NIL disclosures varies by institution. Many universities use online portals for uploading information and documents. Others might require submission via email or in-person meeting. It is advisable to confirm the exact submission method with the university’s compliance department.

After submission, the university’s compliance office reviews the proposed NIL activity for adherence to NCAA, state, and institutional regulations. This review typically takes a few business days, varying by deal complexity. Student-athletes receive notification of approval or disapproval, often with explanations for adjustments or denials.

Tax Implications of NIL Earnings

Student-athletes earning income from Name, Image, and Likeness activities must understand the associated tax implications. NIL income is considered taxable by the Internal Revenue Service (IRS). Most student-athletes engaging in NIL deals are classified as independent contractors, not employees, of the entities paying them. This classification brings specific tax responsibilities that differ from those of traditional employees.

As independent contractors, student-athletes are responsible for paying both income tax and self-employment tax on their NIL earnings. Self-employment tax covers Social Security and Medicare contributions, which would normally be split between an employer and employee. For 2025, the self-employment tax rate is 15.3% on net earnings up to a certain threshold for Social Security, plus an additional 2.9% for Medicare on all net earnings.

Accurate record-keeping is important for all NIL income and related business expenses. Deductible expenses might include agent fees, marketing costs, or professional services directly related to generating NIL income. Maintaining detailed records of both income received and expenses paid can help reduce the amount of taxable income.

Student-athletes may receive Form 1099-NEC, Nonemployee Compensation, from entities that pay them $600 or more for NIL services in a calendar year. This form reports the income paid to the IRS. It is important to track all income throughout the year, even if a 1099-NEC is not received for every payment, to ensure accurate reporting on annual tax returns. Consulting with a tax professional can provide tailored guidance for managing NIL earnings.