Name, image and likeness income

The House settlement effectively allows Division I college sports programs to share revenue directly with student athletes.  Student athletes are still allowed to enter into non-institutional (private) NIL agreements and NIL agreements with NIL collectives.  These non-institutional NIL agreements must still be for a legitimate business purpose.

For more information on the “House Settlement”, visit College Athlete Compensation: Impacts of the House Settlement | Congress.gov | Library of Congress.

The “House Settlement” also established the College Sports Commission (CSC) to enforce the terms of the settlement.  The CSC is an independent body separate from the NCAA.

The settlement also created an NIL reporting requirement for student-athletes and institutions.  NIL Go was launched as the designated reporting entity.  NIL Go is a "software platform" that will be used to determine whether third-party NIL deals "are made with the purpose of using a student-athletes' NIL to advance a valid business purpose and within a reasonable range of compensation."

• Revenue sharing payments received from University or College
• Damages received from the “House Settlement”
• Content creator/social media influencer
• Brand endorsements
• Sponsorship deals
• Autograph fees
• Promotional appearances
• Marketing brands
• Guest appearances at clubs and schools
• Exhibitions
• Endorsements
• Gifts
• Giveaways (gift cards)
• Services received in kind
• Royalties

Student athletes are generally considered employees if they receive Form W-2, and the school or the company paying them will withhold applicable federal and employment taxes (FICA) from their pay.

Report income reported to you using Form W-2 on your Form 1040.

Student-athletes are generally considered self-employed independent contractors for tax purposes if they receive Form 1099-NEC.  Forms 1099-NEC are used to report any payment, or series of payments, totaling $2,000 or more of cash, merchandise, or services in kind paid to you during the year for services you provide to the payor.  The $2,000 reporting threshold is effective for payments received in 2026 and will be indexed for inflation for future years.  Payments you receive for providing your personal services are subject to self-employment taxes in addition to federal income taxes. File a Schedule C, Profit or Loss from Business, with Form 1040 to report self-employment income and related expenses. Also file a Schedule SE.

If you are paid solely for the use of your name, image, and likeness, and do not have to provide any active personal services for the payment, you should receive a Form 1099-MISC for “royalty” income.  An example of “royalty income” is a company using your picture in their advertising.  Your payments for the advertising campaign may have included both a photo shoot fee and a royalty fee.  The photo shoot fee is self-employment income because you personally provided services at the photo shoot.  This payment would be reported on Schedule C .  The Royalty payment for the use of your image is not self-employment income as you did not provide any direct personal services to earn them.  Royalties would be reported on Schedule E but are not reported on Schedule SE.

File a Schedule E, Supplemental Income and Loss, with Form 1040 to report income from royalties and certain other types of income and related expenses.

Income or benefits you received as a student-athlete must be included in taxable income on the FAFSA (Free Application for Federal Student Aid) application and could impact the amount of financial aid granted. Pell grants are based on other factors but can also be impacted by NIL income.

Consider consulting with your financial aid office or advisor before accepting NIL income.

Keep track of all expenses you incur to earn your NIL income including receipts, purchase orders, travel logs, mileage logs, and the like as you may be able to deduct them on your tax return.  Consider consulting a CPA or other tax professional before accepting an NIL contract or entering into any form of partnership, Limited Liability Company membership, or forming a corporate entity to better understand your federal filing requirements.

Keep track of the locations where you perform NIL contract services, because you may owe state tax to a state where you earn income from NIL activities.

Consider consulting a CPA or other tax professional before accepting an NIL contract to understand state filing impacts and to help you meet state filing requirements.

If you are a self-employed independent contractor, there’s typically no tax withheld when you earn NIL income. Accordingly, you may need to make estimated tax payments to cover your income, Social Security and Medicare taxes throughout the year. Doing so may help you avoid a large tax bill and related penalties. Use Form 1040-ES, Estimated Tax for Individuals PDF, to figure these required tax payments.

If you don’t file the required tax returns on time, or if you fail to pay taxes you owe, you could be subject to additional penalties and interest.

If you owe tax or penalties, pay the balance as soon as possible to avoid additional penalties and interest. The IRS has various options to make a payment.