Associated Sports, the dedicated Sports & Entertainment Division of Associated Investor Services, has developed an independent tracking tool to help student athletes, their CPAs, agents and families with the numerous tax implications that come with each Name, Image, Likeness (NIL) deal.
“In speaking with a handful of student athletes about their recently-found NIL income, many expressed their lack-of-experience or knowledge about taxes,” Associated Sports’ founder Evan Vladem said. “That lack of experience and knowledge does not equate in any way to the intelligence of student athletes. The fact of the matter is – taxes are not something most young people, whether they are athletes or not, have ever had to deal with. Education is the first step in solving that problem.”
NIL income is considered self-employment income. Whether the student athlete received a payment from a deal in cash, merchandise spend, merchandise sold or trade - it may be considered taxable. Based on the compensation that accrues from each deal within the year, federal, state, and self-employment taxes may come into play.
“Based on each student athlete’s situation, all factors need to be accounted for - including their state of residence, their guardian’s state of residence and whether or not they are receiving financial aid. NIL can have monumental impact on financial aid eligibility,” Vladem said. “When tax time rolls around, having tracked the details of every deal is going to key for student athletes with NIL income.”
Student athletes can also take advantage of tax deductions from business expenses such as mileage deductions when their auto is used for business.
The Associated Sports’ NIL Deal Tracker gives athletes and their team the ability to easily track details such as residency, the type of NIL deal and compensation, 1099s received, cash amount and/or trade/merchandise amount accrued and business expenses around each deal.
“Taxes can be complicated. It all starts with education and having a good team around you,” Vladem said. “There’s no better time than now for student athletes to start aligning with a strong financial advisor, CPA and attorney. We’re certainly happy to help but if we’re not the right fit, we’re urging student athletes to exercise careful due diligence during the selection process. Make sure the individuals are truly licensed professionals with proper designations, all of which can be easily found online.”
ARE YOU A STUDENT ATHLETE, PARENT, AGENT OR CPA INTERESTED IN USING ASSOCIATED SPORTS’ INDEPENDENT NIL DEAL TRACKER? CONTACT EVAN VLADEM TODAY VIA EMAIL (evan@afc-ais.com) OR CALL 954-519-4742.