Who Will Explain To College Athletes The New NCAA’s Rules For Compensation.
The National Collegiate Athletic Association’s (“NCAA”) Board of Governors announced support for a plan that would allow college athletes to be personally compensated for use of their names, images and likenesses (“NIL”). If the NCAA votes to accept the rules, they will go into effect no later than the start of the 2021-2022 academic year. As result, college athletes will be earn money for doing endorsements, earn money on advertisements, and even charge for autographs. However, there are still many unanswered questions for athletes. PMG Intrinsic seeks to guide young athletes through this lucrative but confusing time.
The NCAA indicated there will be no cap on earnings from NIL; however, the compensation must be for “fair market value.” This mystical term is still currently undefined by the NCAA. Additionally, while the athletes would be allowed to mention the school they attend and their status as college athletes, they would not be allowed to use any school branded marks in advertisements or wear clothing with school labels. It is fair to compensate college athletes for their work, it is not fair to throw them into this sea of rules without a life raft.
Adding another layer to this Gordian knot, is that college athletes will need to seek consultation on the tax ramifications on this compensation when they should be focused on their education and athleticism. It will be unfortunate to penalize young athletes for the complex tax rules and regulations that arise from such compensation. Just a few examples, college athletes will need to consider such items as: individual state income tax filings, nexus rules that would require individual filings, and what constitutes a legitimate business deduction.
PMG Intrinsic is uniquely positioned to help college athletes manage their businesses, minimize their taxes, and maximize their promotion and marketing opportunities when the NCAA finally promulgates its rules.