NIL is changing at UConn

[UConnJim]

Again though. If the environment is unsettled why do it now and not wait it out and see what happens. It doesn't even have to be tax deductible. For instance monies given by the collective don't have to obey title ix. Those that are given by the school will

There was no path forward for the external non-profit collectives. The IRS ruled that collectives are not tax deductible organizations and they planned to make oversight of collectives a priority in 2025. And, some of the biggest collectives were getting legal and financial scrutiny from states and the federal government and the collectives were anticipating legal and financial audits and decided to close. This is not a UConn issue. Basically, almost all of the non-profit collectives closed as of year end. The largest collective, BPS Foundation, which managed collectives for Arizona, NC St., BC, Montana St., Nevada, Penn St., UNLV, Gonzaga, and UC Santa Barbara shut down at the end of last year as did the collectives at Notre Dame and Alabama.

The quirk in all of this is that donations to athletic departments are generally tax deductible unless you as an individual receive a direct benefit. So, it is possible that you can donate to the athletic department and the money is used to pay athletes and the donor gets a deduction. We'll see if that happens.

As a side note, the D'Amelio Collective never advertised itself as a non-profit and focused on helping athletes build brands. This type of collective will probably continue.

 

[CL82]

How about when the first athlete gets in trouble for tax evasion? I am betting it will happen at SMU.

Manageable. W-2 them and introduce them to an accountant when they come on board.

 

[Patman]

There was no path forward for the external non-profit collectives. The IRS ruled that collectives are not tax deductible organizations and they planned to make oversight of collectives a priority in 2025. And, some of the biggest collectives were getting legal and financial scrutiny from states and the federal government and the collectives were anticipating legal and financial audits and decided to close. This is not a UConn issue. Basically, almost all of the non-profit collectives closed as of year end. The largest collective, BPS Foundation, which managed collectives for Arizona, NC St., BC, Montana St., Nevada, Penn St., UNLV, Gonzaga, and UC Santa Barbara shut down at the end of last year as did the collectives at Notre Dame and Alabama.

The quirk in all of this is that donations to athletic departments are generally tax deductible unless you as an individual receive a direct benefit. So, it is possible that you can donate to the athletic department and the money is used to pay athletes and the donor gets a deduction. We'll see if that happens.

As a side note, the D'Amelio Collective never advertised itself as a non-profit and focused on helping athletes build brands. This type of collective will probably continue.

I'm failing to see the problem here. If it isn't a nonprofit then is the problem that a for profit entity would have to have the legal goal of making money?

I'm just looking to see how title ix can be avoided.

 

[UConnJim]

I'm failing to see the problem here. If it isn't a nonprofit then is the problem that a for profit entity would have to have the legal goal of making money?

I'm just looking to see how title ix can be avoided.

Converting a non-profit to a for profit organization is a complicated and lengthy process. It is much easier to close it down and have the various athletic departments take over the function.

 

[Patman]

Converting a non-profit to a for profit organization is a complicated and lengthy process. It is much easier to close it down and have the various athletic departments take over the function.

But again, that opens a title ix trap.

 

[FfldCntyFan]

Manageable. W-2 them and introduce them to an accountant when they come on board.

My guess is that they'll be 1099'd.

 

[CL82]

My guess is that they'll be 1099'd.

We'll see. If you apply a "20 factor test" analysis I think they come out as employees.

 

[Patman]

We'll see. If you apply a "20 factor test" analysis I think they come out as employees.

I think they're resigned to that so it'll end up being the same.

 

[huskymedic]

Connecticut/UConn is positioning itself for the reality of the future:

-> Benedict told the committee that several states — including Louisiana, Mississippi, Nebraska, Oklahoma, Utah and Virginia — have either proposed or already approved legislation to allow schools in their states to offer revenue-sharing to current student-athletes.

Given the inevitability of the lawsuit settlement, Benedict said, “it is imperative that Connecticut once again be among the first states to act so we do not find ourselves in a detrimental situation in terms of student-athlete recruitment and retention.”

While generally supporting the proposed language of the bill, he did ask for one change.

“I ask you to consider expanding the definition of a student athlete to include students who have accepted an offer to attend a Connecticut university, but may not yet be enrolled,” he said. “This will enable our coaches to operate in the same manner as their peers who are actively executing contracts with recruits who have committed.” <-

 

[bobbyinaz]

Georgia bill would exempt NIL dollars from income tax

A new Georgia Senate bill filed on Monday would exempt NIL compensation received by college athletes from the state income tax.

www.on3.com

The easiest way to address NIL tax issues is for government to make them go away.

 

[Patman]

Georgia bill would exempt NIL dollars from income tax

A new Georgia Senate bill filed on Monday would exempt NIL compensation received by college athletes from the state income tax.

www.on3.com

The easiest way to address NIL tax issues is for government to make them go away.

I don't see why people shouldn't be taxed on income but that's just me

 

[Kolumbo]

I don't see why people shouldn't be taxed on income but that's just me

A key point here is that some states will tax NIL income and some will not, whether because they have no state income tax or doing what Georgia suggests. Connecticut is at a disadvantage. Georgia wants to be level with Florida, Tennessee, and Texas which have no state income tax.

 

[Patman]

A key point here is that some states will tax NIL income and some will not, whether because they have no state income tax or doing what Georgia suggests. Connecticut is at a disadvantage. Georgia wants to be level with Florida, Tennessee, and Texas which have no state income tax.

I mean i agree about that. I guess I feel that some are making it a moral position... I think maybe I'm getting cross purposes. A lot going on right now

 

[FfldCntyFan]

Georgia bill would exempt NIL dollars from income tax

A new Georgia Senate bill filed on Monday would exempt NIL compensation received by college athletes from the state income tax.

www.on3.com

The easiest way to address NIL tax issues is for government to make them go away.

That's just state income tax and I would wager Georgia will do this to avoid their school being at a disadvantage to schools in Florida and Texas (no income tax states).

Federal income tax is a separate issue but this has me wondering if states will start treating NIL dollars the way they treat professional athletes income (apportioned by percentage of total games played in each jurisdiction).

 

[Patman]

That's just state income tax and I would wager Georgia will do this to avoid their school being at a disadvantage to schools in Florida and Texas (no income tax states).

Federal income tax is a separate issue but this has me wondering if states will start treating NIL dollars the way they treat professional athletes income (apportioned by percentage of total games played in each jurisdiction).

I mean when it comes from a private group like an auto dealer that's clearly work done for money. When it comes from Jim Bob is that just a gift and that's on the giver? I don't know the rules on gift taxes. If the school is giving that then it looks a whole lot like income from an employer. I am not a lawyer but it may be all of the above? Schools may tell big money donors to give directly to the player in order to reduce tax burden

 

[huskymedic]

Keep any partisan nonsense in the Cesspool:

 

[UConnTrumbull]

Keep any partisan nonsense in the Cesspool:

Nothing particularly partisan in that article. Sounds like the steps are being taken for uconn to navigate the changes in the college sports landscape.

 

[Kolumbo]

Nothing particularly partisan in that article. Sounds like the steps are being taken for uconn to navigate the changes in the college sports landscape.

Good article. It's always partisan though, especially when it comes to paying coaches salaries and now players salaries. We won't get into the partisan side though. Good to see the state taking action.

Interesting: "The legislation would exclude NIL and revenue sharing deals from FOIA requests, records show."

"The NCAA hopes for federal laws to regulate NIL and other compensation for college athletes in place of the individual laws that differ from state to state. Right now, UConn is looking for the removal of any restrictions by local laws."

 

[upstater]

Good article. It's always partisan though, especially when it comes to paying coaches salaries and now players salaries. We won't get into the partisan side though. Good to see the state taking action.

Interesting: "The legislation would exclude NIL and revenue sharing deals from FOIA requests, records show."

"The NCAA hopes for federal laws to regulate NIL and other compensation for college athletes in place of the individual laws that differ from state to state. Right now, UConn is looking for the removal of any restrictions by local laws."

The law on FOIA will probably be challenged if anyone cares.

 

[huskymedic]