Legislation for NIL

NIL rights are rooted in the right of publicity: the right to control one’s image and name for commercial purposes.

At the heart of NIL rights lies the legal concept known as the “right of publicity” that grants individuals control over the commercial use of their name, image, and likeness.

If a third party uses an athlete’s NIL without permission, the athlete may have grounds to file a legal claim for violation of their publicity rights.

NIL income is taxable. Student-athletes must file income tax returns and may face complex tax obligations, including self-employment tax in some cases.

International students may face double taxation depending on tax treaties between their home country and the United States.

Without proper tax planning and legal counsel, athletes may unintentionally violate tax laws or face penalties.

Many college athletes are under 18 and legally minors. Contract law varies by state; in many states, minors can void contracts, creating instability in NIL agreements.

Approximately 5% to 10% of NCAA Division I college athletes begin their collegiate careers before the age of 18, particularly in sports like football, basketball, gymnastics, and tennis.

Several states have introduced NIL legislation that provides specific protections for such agreements, allowing minors to sign enforceable NIL contracts with parental consent.

Are Student-Athletes Employees?

A key legal debate is whether student-athletes should be classified as employees. If classified as employees, they would be entitled to minimum wage, workers’ compensation, and other labor protections.

Critics argue that athletes—especially in revenue-generating sports like football and basketball—provide labor that directly benefits their institutions financially.

Active cases (e.g., Johnson v. NCAA ) argue that athletes perform work for universities and deserve employee status.

NCAA v. Alston (2021)

The Supreme Court ruled that NCAA restrictions on education-related benefits violated antitrust law.

This case weakened the NCAA’s control over athlete compensation and set the legal foundation for NIL freedom.

The Court held that these restrictions violated federal antitrust law, sending a strong legal signal that the NCAA’s long-standing model of amateurism could no longer be shielded from market-based legal scrutiny.

States like California passed the Fair Pay to Play Act in 2019, allowing NIL activities ahead of NCAA reform.

Proposed federal legislation, such as the Student Athlete Level Playing Field Act in 2023, aims to standardize NIL rights across the country.

The lack of a unified federal law creates inconsistencies among states, contributing to confusion and inequities across institutions and has prompted growing calls for a unified federal NIL standard.

International students on F-1 visas face major barriers, as their visa status prohibits unauthorized employment, including NIL-related work conducted in the U.S.

Engaging in paid endorsements, promotional events, or social media monetization in the U.S. could constitute a violation of visa terms, potentially leading to the loss of legal status.

International athletes are largely excluded from participating in the NIL economy unless they can structure deals that occur entirely outside the U.S.