Are you new to the world of NIL, below are a few facts to help get you started.
What does NIL stand for?
NIL stands for Name, Image and Likeness. NIL refers to the use of an athletes’ name, image and likeness through their own promotional endeavors and their ability to receive financial compensation just like their non-athletic peers.
What is an example of NIL?
Examples of NIL can include making money as:
- a social media influencer
- running a camp
- hosting training sessions
- making promotional appearances
- corporate partnerships
- charitable appearances
- athletic or non athletic business
- creating and selling their own products, and much more
NIL also means that student-athletes can hold a paying job, which wasn’t permissible before NIL was enacted into law in 2021.
What is the Fair Pay to Play Act?
The Fair Pay to Play Act made it illegal for colleges and universities in California to deny their athletes opportunities to make money off of their name, image and likeness. The statute was signed into law on September 30, 2019, and was effective as of September 1, 2021. The Fair Pay to Play act set into motion the passing of other states allowing student-athlete compensation to happen.
What states allow athletes to profit off of NIL?
This chart from on3.com provides a list of states where NIL activities are permissible at the collegiate and high school level.
Why don’t people like NIL?
Some people don’t like NIL because it creates inequities between players, especially for those competing in revenue-generating sports. With NIL being so new, people also feel an unregulated NIL market could lead to scandals amongst student-athletes, eligibility issues and more.
Why do others like NIL?
The ability for student-athletes to profit off of their name, image and likeness comes years after colleges, universities, and big named broadcasters have made billions… yes billions of of student-athletes’ NIL. The opportunity for athletes to profit off on NIL is also a plus because student-athletes can now manage their own brands, support themselves, and support their families.
Can high school athletes make NIL money?
Yes, while fewer states have allowed high school athletes to profit off of NIL, there are high school athletes who have profited off of NIL.
Can all college athletes (DI, DII and DIII athletes) make NIL money?
Yes! All athletes can make money thanks to NIL. Earning potential and strategy will differ depending on an athlete’s ability to market themselves and find a competitive advantage within their market. If an athlete attends a smaller school and has less exposure to big brands, they can hold a traditional paying job which wasn’t permissible prior to NIL being signed into law.
Do you have to pay taxes on NIL?
Yes. NIL is considered taxable income, meaning athletes must report all NIL earnings on their federal & state tax returns or on their parents tax returns.