NIL and tax

[Wahoooo]

Just wondering…

We have all read of stories about guys going to the NFL, NBA, etc., who have come from backgrounds where there was not much wealth, if any. They get a good amount cash and many, not all, squander it, get in financial trouble, eventually owning the IRS substantial amounts.

With all these high school kids getting a lot of money, it would seem that in the near future we will be hearing many more sad stories about these kids as well. At least the kids who go to college may have slightly more maturity when it comes to these things.

Hopefully most have some legit financial advisor in their corner. If not, what happens when the IRS comes knocking?

 

[TC 83]

It will happen. They blow it, then get loans, and get real f’d. Humans and their behaviors with money never cease to amaze.

 

[UT Hill Man]

I remember Willie Nelson got in deep tax trouble, had to basically go on the road for 10 years to pay off his IRS debts.

But I'm sure these 18, 19, 20 year old kids will be fine.

 

[K-town Vol Fan]

I'm nearly certain UT has advisors for these types of things. They aren't just handing kids millions and saying here ya go have fun. At the very least I would think they take care of the tax side of things.

 

[stolitonic]

It will happen. They blow it, then get loans, and get real f’d. Humans and their behaviors with money never cease to amaze.

I am curious about how the players are paid by spyre-do they take out taxes before they cut a check?

As the players are not employees and basically working for themselves, I would imagine that the 15% penalty still applies?

Basically if a player signs an NIL deal with spyre for $1 million a season (for simplicity).

I would imagine that's about. 37% tax (or more) off the top plus the 15%.

So, do the players get checks tattling $1 million or do they get checks for about $480k after taxes, etc?

If they just get the raw amount, then yes tax troubles will be coming. If Spyre takes it out in advance and reports it, then it would be pretty hard for the players to have irs issues based solely on a Spyre payment?

Does this question make sense?

 

[TC 83]

I

I am curious about how the players are paid by spyre-do they take out taxes before they cut a check?

As the players are not employees and basically working for themselves, I would imagine that the 15% penalty still applies?

Basically if a player signs an NIL deal with spyre for $1 million a season (for simplicity).

I would imagine that's about. 37% tax (or more) off the top plus the 15%.

So, do the players get checks tattling $1 million or do they get checks for about $480k after taxes, etc?

If they just get the raw amount, then yes tax troubles will be coming. If Spyre takes it out in advance and reports it, then it would be pretty hard for the players to have irs issues based solely on a Spyre payment?

Does this question make sense?

Yes, but I really don’t know how Spyre operates. I do know you’ll have more republican voters after these kids see what Unc does to their checks. And also, the benefit of living in the great state of TN with no state income tax. That money goes a lot further here than it does in most states.

 

[CR-vol]

I am curious about how the players are paid by spyre-do they take out taxes before they cut a check?

As the players are not employees and basically working for themselves, I would imagine that the 15% penalty still applies?

Basically if a player signs an NIL deal with spyre for $1 million a season (for simplicity).

I would imagine that's about. 37% tax (or more) off the top plus the 15%.

So, do the players get checks tattling $1 million or do they get checks for about $480k after taxes, etc?

If they just get the raw amount, then yes tax troubles will be coming. If Spyre takes it out in advance and reports it, then it would be pretty hard for the players to have irs issues based solely on a Spyre payment?

Does this question make sense?

They're 1099 contractors so nothing is withheld by anyone. They'll pay quarterly taxes, hopefully be incorporated, and as long as they hire good people to help with that and accounting they'll be just fine.

 

[TennesseeTarheel]

I agree, we're going to be hearing some sob stories.

 

[savannahfan]

Just wondering…

We have all read of stories about guys going to the NFL, NBA, etc., who have come from backgrounds where there was not much wealth, if any. They get a good amount cash and many, not all, squander it, get in financial trouble, eventually owning the IRS substantial amounts.

With all these high school kids getting a lot of money, it would seem that in the near future we will be hearing many more sad stories about these kids as well. At least the kids who go to college may have slightly more maturity when it comes to these things.

Hopefully most have some legit financial advisor in their corner. If not, what happens when the IRS comes knocking?

And who will get more the IRS or the advisor??

 

[DaddyChad]

It will happen. They blow it, then get loans, and get real f’d. Humans and their behaviors with money never cease to amaze.

Yep. You give a person that’s bad with money a blank check and they’ll still end up poor. Give someone who’s responsible with money a small amount and they will grow it.

 

[OrangeCola]

I'd bet good money this won't be any worse than your usual 1099 employee..and don't come at me when a couple of sob stories appear, come at me hundreds appear

And we certain these guys aren't willing out W-4s and getting taxed

 

[SayUWantAreVOLution]

I'm not sure about the angst around kids and NIL. Most Americans suck at saving money and your average 30yo has about 20k-30k in savings.

If these guys and gals end up with more or less 25k saved at 30, they're average. If they're below, even though they had millions, I hope they enjoyed it. If they're above, I hope they eventually enjoy it.

It's as though we expect these kids are going to be better than our own kids who likely blow a lot of money they should have saved too just on a smaller scale.

 

[Swiftybaby]

I'm not sure about the angst around kids and NIL. Most Americans suck at saving money and your average 30yo has about 20k-30k in savings.

If these guys and gals end up with more or less 25k saved at 30, they're average. If they're below, even though they had millions, I hope they enjoyed it. If they're above, I hope they eventually enjoy it.

It's as though we expect these kids are going to be better than our own kids who likely blow a lot of money they should have saved too just on a smaller scale.

Brother where you getttin this info that the avg 30yo has 20-30k? Inquiring minds would like to know

 

[SayUWantAreVOLution]

Brother where you getttin this info that the avg 30yo has 20-30k? Inquiring minds would like to know

You know, I didn't look that up but I see I wildly underestimated how bad Americans are at saving money and how poor the economy/wages actually are in America.

You're right. It's less than half the 25-30k that I stated despite financial planners saying it should be near double the 25-30k.

My bad and I should probably talk to my kids about how they're doing with savings.

 

[HuntlandVolinColo]

Since Tennessee has no state tax this should be an NIL selling point!

 

[stolitonic]

I'm not sure about the angst around kids and NIL. Most Americans suck at saving money and your average 30yo has about 20k-30k in savings.

If these guys and gals end up with more or less 25k saved at 30, they're average. If they're below, even though they had millions, I hope they enjoyed it. If they're above, I hope they eventually enjoy it.

It's as though we expect these kids are going to be better than our own kids who likely blow a lot of money they should have saved too just on a smaller scale.

Bruh, I have done pretty well for myself in life.

At 30, my bank balance was probably more like $25
At 20, my bank balance was probably more like negative $25

Everyone walks a different path in life, but nobody I know outside of the trust fund kids was sitting on a $25k egg by that age.

 

[HeavenUniversity]

If you deduct only credit card debt and car loans, I would be surprised if the average 50 year-old has $30,000 in savings.

 

[Okie]

A perfect example:

Adrian Peterson made more than $100 million in the NFL. He now has warrants out because he owes a bank $12 million and has no cash to pay any of it back. He has 12 kids by 8 different women, IIRC, and can't pay child support. I haven't read that the IRS is on him yet, but expect to read about that soon.

It's their money and I don't care if the blow it all. I don't want someone telling me how to blow my money. Except when you can't pay child support. That's not acceptable to me in any form.

Giving huge $ to unproven HS kids to go to their schools without any financial parameters will not turn out well.

 

[LegionnaireOfTheMiserable]

A perfect example:

Adrian Peterson made more than $100 million in the NFL. He now has warrants out because he owes a bank $12 million and has no cash to pay any of it back. He has 12 kids by 8 different women, IIRC, and can't pay child support. I haven't read that the IRS is on him yet, but expect to read about that soon.

It's their money and I don't care if the blow it all. I don't want someone telling me how to blow my money. Except when you can't pay child support. That's not acceptable to me in any form.

Giving huge $ to unproven HS kids to go to their schools without any financial parameters will not turn out well.

There are also plenty of people who never made any money at all hardly in that same exact position. Maybe not owing 12 mil, but seriously in debt with no money to pay child support to several kids and possibly cheating on their taxes. It’s not really reason not to let the college players make money. I’d rather be in debt because I blew my money than be in debt because I never had any, if I had to choose.

 

[Remy]

For your consideration. Someone like Nico pays zero state income tax on any NIL $s he gets if he changes his residence to Tennessee rather than leaving it in California which has one of the highest income tax rates in the nation. Tennessee, Florida, and Texas are I believe the only SEC states without a state income tax. Helluva a recruiting advantage if you take a pay cut when two schools offer you the same $s or if state income taxing schools have to make up the difference with more $s just to keep the same amount in the players pockets. Bama used to have some cities that taxed income as well although that may have changed.

 

[VOLLeeann]

Since Tennessee has no state tax this should be an NIL selling point!

For the semi-enlightened it is.

 

[OldVol]

I can’t imagine there is not mandatory withholding on NIL money.

 

[Vol8188]

Just wondering…

We have all read of stories about guys going to the NFL, NBA, etc., who have come from backgrounds where there was not much wealth, if any. They get a good amount cash and many, not all, squander it, get in financial trouble, eventually owning the IRS substantial amounts.

With all these high school kids getting a lot of money, it would seem that in the near future we will be hearing many more sad stories about these kids as well. At least the kids who go to college may have slightly more maturity when it comes to these things.

Hopefully most have some legit financial advisor in their corner. If not, what happens when the IRS comes knocking?

Spyre is probably handling payroll taxes

 

[overseasorange2]

There are also plenty of people who never made any money at all hardly in that same exact position. Maybe not owing 12 mil, but seriously in debt with no money to pay child support to several kids and possibly cheating on their taxes. It’s not really reason not to let the college players make money. I’d rather be in debt because I blew my money than be in debt because I never had any, if I had to choose.

My dad always said," Money is not everything, but I would rather have it than not!".

 

[freedom fighter]

My dad always said," Money is not everything, but I would rather have it than not!".

My Father said "Money is Power"