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Question for the tax experts: why don't college athletes have to pay taxes to away states

Posted on 10/13/26 at 8:11 am
Posted by SEC Doctor
Member since Aug 2024
13242 posts
Posted on 10/13/26 at 8:11 am
I know all the NBA, NFL and MLB guys have to pay taxes to all the states they play games in. I recall reading about how Sam Darnold lost money because the Super Bowl was in California.

Why don't college players?
Posted by LNCHBOX
70448
Member since Jun 2009
89709 posts
Posted on 10/13/26 at 8:14 am to
Because they aren't earning the money for playing the games :wink:
Posted by Alt26
Member since Mar 2010
36740 posts
Posted on 10/13/26 at 8:17 am to
The players aren't employees, they aren't being paid a salary, and they aren't earning "income" in those other states. They are being paid for their NIL. Is that an inducement to play for a certain school? Of course. But it is not a salary
Posted by TROLA
BATON ROUGE
Member since Apr 2004
15045 posts
Posted on 10/13/26 at 8:28 am to
Simple answer is that there earned income isn’t based on the actual game location but in theory their NIL…. Once the dust settles I’d imagine some states will try to capture some these monies by challenging that nuanced distinction
Posted by Crimson K
Tuscaloosa
Member since Dec 2018
8138 posts
Posted on 10/13/26 at 8:31 am to
A player at a school like say USC/UCLA is on the hook for the high state and local taxes in CA though? Or is it based off of their home state?
Posted by SEC Doctor
Member since Aug 2024
13242 posts
Posted on 10/13/26 at 8:49 am to
quote:

A player at a school like say USC/UCLA is on the hook for the high state and local taxes in CA though? Or is it based off of their home state?


I would have to imagine they pay state taxes where the income is earned, not their home state.
Posted by Mingo Was His NameO
Brooklyn
Member since Mar 2016
38241 posts
Posted on 10/13/26 at 8:54 am to
quote:

I would have to imagine they pay state taxes where the income is earned, not their home state.


Depends, could be both depending on the state where the income is earned and the state of domicile
Posted by GolfIsGood
Member since Jun 2017
362 posts
Posted on 10/13/26 at 9:08 am to
Correct. Players often have multiple NIL deals. Similarly NFL players can have multiple endorsement deals. NFL players only pay a portion of their NFL salary as a visiting player tax in states where they play road games, they do not pay any portion of their endorsement deals.
Posted by TigerintheNO
New Orleans
Member since Jan 2004
45545 posts
Posted on 10/13/26 at 10:20 am to
Arkansas passed a law, that NIL isn't subject to income tax
Posted by Mingo Was His NameO
Brooklyn
Member since Mar 2016
38241 posts
Posted on 10/13/26 at 10:26 am to
quote:

Arkansas passed a law, that NIL isn't subject to income tax


While this is absolutely retarded, it’s only payments made directly from the university. Any third party deals are still subject to tax
Posted by MikeD
Baton Rouge
Member since Jan 2004
8748 posts
Posted on 10/13/26 at 10:44 am to
The revenue share that comes directly from the school should be taxed by game where it is earned IMO.
Posted by Diseasefreeforall
Member since Oct 2012
7536 posts
Posted on 10/13/26 at 11:07 am to
quote:

The revenue share that comes directly from the school should be taxed by game where it is earned IMO.


Not for NIL because that's not money specifically paid for participating in games but yes for revenue sharing money provided by the school so my guess is that is happening.
Posted by Mingo Was His NameO
Brooklyn
Member since Mar 2016
38241 posts
Posted on 10/13/26 at 11:59 am to
quote:

but yes for revenue sharing money provided by the school so my guess is that is happening.


It’s not because the “adults” at the ncaa and universities say that NIL is not payment for participating in the games but for only their name, image, and likeness.

This is actually an interesting point though, because the IRS, state revenue departments, and tax courts aren’t really bound to the case law regarding eligibility and NIL, that could theoretically classify that income similar to professional athletics and duty days.
This post was edited on 10/13/26 at 12:01 pm
Posted by Bestbank Tiger
Premium Member
Member since Jan 2005
83587 posts
Posted on 10/13/26 at 12:21 pm to
quote:

This is actually an interesting point though, because the IRS, state revenue departments, and tax courts aren’t really bound to the case law regarding eligibility and NIL, that could theoretically classify that income similar to professional athletics and duty days.


It might be a difficult case to make because they have to prove the NIL is really for playing.

The first NIL millionaire was Livvy. She wasn't even a starter. She got oaid for veing an influencer.

Flaujae got paid for being a rapper. Angel had modeling gigs. A state like California would have to prove she wouldn't have any modeling contracts without basketball.

Even with Arch Manning you'd have to prove something was a duty day, and he wasn't getting paid for being a Manning.
Posted by Indiangensing
Member since Nov 2017
2579 posts
Posted on 10/13/26 at 12:35 pm to
I will chuckle in about 10 years when you start hearing stories about player A and player B in deep shite with the IRS because they didn't know anything about paying taxes. NIL was so rushed and irresponsible that of course it turned into this mess. These players weren't starving as they claimed, they got room and board and free clothing. We all failed and have lost the American amateur student athlete as a result. It needs burned down altogether... you wanna be paid to play sports then try out for a professional team at 18 or after high school!
Posted by Mingo Was His NameO
Brooklyn
Member since Mar 2016
38241 posts
Posted on 10/13/26 at 12:36 pm to
quote:

It might be a difficult case to make because they have to prove the NIL is really for playing.


The players get a portion of the tv revenue directly from the universities
Posted by Mingo Was His NameO
Brooklyn
Member since Mar 2016
38241 posts
Posted on 10/13/26 at 12:37 pm to
quote:

I will chuckle in about 10 years when you start hearing stories about player A and player B in deep shite with the IRS because they didn't know anything about paying taxes


Every P4 team has financial advisors for players on staff
Posted by SoDakHawk
South Dakota
Member since Jun 2014
11152 posts
Posted on 10/13/26 at 1:02 pm to
Wonder how many players paid taxes on the bags of money they received under the table in the old days. My guess is zero.
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