Senator Richard Burr is proposing a bill on tax education for high-paid college athletes from name, image, similarity

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Senator Richard Burr is proposing a bill on tax education for high-paid college athletes from name, image, similarity

As background, on July 1, the NCAA’s new rules took effect, allowing student-athletes to benefit from their name, image and likeness, following the enactment of state laws across the country and the US Supreme Court ruling finding that the NCAA’s restriction of certain benefits for student-athletes violated antitrust laws. The NCAA says these rules will be in place until Congress passes federal legislation setting a uniform standard for name, image and likeness compensation.

But for Sen. Burr – he feels there should be legislation to “protect the integrity of amateur athletics at colleges and universities across the nation.”

Sen. Burr says the premise of the bill is that if a student chooses to make money from their name, image and likeness “based on their connection to their school” – their scholarship should be subject to federal income taxation.

“Collegiate athletes are given the unique opportunity of competing for their school while receiving a quality, post-secondary education,” Sen. Burr said. “The NCAA’s recent decision to rescind its long-standing prohibition on outside compensation will fundamentally change the landscape of college athletics.

Story Highlights

  • On Wednesday, Sen. Burr introduced the NIL Scholarship Tax Act, a bill that would have college athletes choose between a tax-free scholarship or the opportunity to earn money for their name, image, or likeness (NIL).

  • Most states who have adopted these rules say compensation for a student’s name, image and likeness will not affect a student-athlete’s scholarship eligibility.

Under this proposed bill, student-athletes earning less than $20,000 from outside compensation would continue to receive their scholarship under the same tax treatment; however, students who earn more than $20,000 per year would be required to include their scholarship in Adjust Gross Income for federal income tax.

“As one of only two former scholarship athletes serving in the U.S. Senate, I remain concerned that the NCAA’s action ignores the fact that only a handful of revenue-generating sports financially support the majority of non-revenue generating sports on college campuses. Some students go on to play professionally, but the vast majority do not. The majority of student-athletes rely on their college education for future earnings. The premise of this bill is simple: if a student chooses to monetize their name, image, and likeness based on their connection to their school – in some cases earning them $1 million or more a year – their scholarship should be subject to federal income taxation. It’s critical that we help protect the successful collegiate sports model that has provided students with educational and professional opportunities for more than a century,” Sen. Burr said.

This is not the first time Sen. Burr has mentioned taxing college athletes who make money from their name image or likeness. If college athletes are going to make money off their likenesses while in school, their scholarships should be treated like income. I’ll be introducing legislation that subjects scholarships given to athletes who choose to “cash in” to income taxes. https://t.co/H7jXC0dNls

— Richard Burr (@SenatorBurr) October 29, 2019 In 2019, Sen. Burr tweeted that if students are going to be able to make money from their likeness while in school, then their scholarships should be treated as income.

“If college athletes are going to make money off their likenesses while in school, their scholarships should be treated like income. I’ll be introducing legislation that subjects scholarships given to athletes who choose to “cash in” to income taxes,” Sen. Burr’s 2019 tweet read. Read the bill below:

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