IRS getting involved in the NIL?

#26
#26
JRich said:
It's a pretty safe assumption for Gen Z kids. Go check out your local public high school curriculum. You'd be hard pressed to find any significant lessons on private money management, tax codes, government or basic economics. That stuff was replaced 20 years ago.
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Hell, there’s grown adults who’ve failed to pay income taxes. Isn’t that’s what got Pete Rose to in legal trouble? He failed to pay taxes on money he earned at card shows, autographs.
 
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#27
#27
K-town Vol Fan said:
You're assuming the university just hands out millions of dollars to 19 year olds and doesn't have some sort of plan in place to handle taxes? Seems like that would be a huge mistake.
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I'm still trying to understand why people are handing millions to 18-year-olds. It's positively stupid and unnecessary and absurd.
 
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#28
#28
Orange defense said:
There’s Tax man problems.

Aggieland was stunned when Texas A&M’s 12th Man+ fund, one of the biggest NIL fundraising operations in the country, was abruptly shut down for legal purposes.
The problems started when the IRS sent out a memo in early June stating that NIL Collectives can’t qualify as 501©(3) nonprofits, and thus should not enjoy tax-exempt status, which is exactly what the 12th Man+ fund had been doing.

There’s playing time problems.

A study of what happens to portal kids which is driven by NIL money shows
72% of portal transfers play few snaps than their previous school.
37% did not start a game.
G5 to P5 transfers rarely get the same snap time as they did with G-5 schools.
Higher profile HS recruits are growing in numbers at G5 schools due to lack of available spots on P5 rosters.
Post season coaching changes can severely handicap new coaches who miss the portal. Scholarship players leave and the new coach can see a good team turn bad quickly.
A small study of 104 G5 athletes playing 500 snaps or more had only 13 match snaps going to P5. The average had their snaps by over half.
Most G5 schools are working with limited NIL money. Tulane mentioned as having a $1.5 million war chest.
Biggest P5 is Texas with $19.9 million
UCF $2.5. Vandy $2.4. Cincy $1.9. Houston. $1.5. SMU. $2.1. Boise $2.0


With these numbers only NIL potential makes the poor odds worth it.
Silverfield seems to looking pretty savvy finding lower G5 transfers.

Anybody know what the 901 Fund war chest totals?
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Tax them at 100%.
 
#29
#29
C'mon, y'all act like each one of these kids is going to end up in multi-million dollar tax tangles with the IRS. They're not.

All these guys aren't becoming millionaires and the IRS isn't sending a task force armed and ready to seize records from some college kid's apartment.

The IRS isn't going to "bring the hammer" on these kids nor does them not filing or filing wrong on $100k or $200k raise an eyebrow at the local IRS. It's a letter or two, maybe a meeting, and payment or a payment plan....... if it even gets that far.

Just put away your jealousy for a few minutes.
 
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#30
#30
NATHAN05 said:
... teach these guys about financial decisions, taxes, etc........especially because I bet most of these 18, 19, 20 year olds have never even filed taxes.....
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I've been advocating for years that personal finance should be a mandatory college course. Too many "educated" people just don't seem to comprehend money management.
 
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#31
#31
Many collectives use this company and I read they act as distributor in some cases. If so taxes may be deducted before distributing.

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#32
#32
VolinMichigan said:
Wait til these kids making big NIL money figure out that earning income means you have to pay taxes. I’m all for paying players but there’s going to be some harsh lessons in financial literacy for some of these guys.
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Don't you think the NIL agencies are required withhold taxes?
 
#34
#34
SayUWantAreVOLution said:
Athletes are 1099 employees, I think, in NIL deals, so no.
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It depends on the fact dependent nature of the worker relationship. I think you are right, in most cases, they will be 1099 contractors responsible for all their own income taxes and self-employment taxes.

There could be a lot of planning opportunities for many of these athletes, such as s corporations, if they are aware to consult competent tax professionals.

I don't think there's ever been any doubt that contributing to an NIL collective is absolutely not a charitable donation. And for business owners, it's much better to work out your own deal with an athlete if you want it to be an advertising or marketing deduction.
 
#36
#36
37620VOL said:
It depends on the fact dependent nature of the worker relationship. I think you are right, in most cases, they will be 1099 contractors responsible for all their own income taxes and self-employment taxes.

There could be a lot of planning opportunities for many of these athletes, such as s corporations, if they are aware to consult competent tax professionals.

I don't think there's ever been any doubt that contributing to an NIL collective is absolutely not a charitable donation. And for business owners, it's much better to work out your own deal with an athlete if you want it to be an advertising or marketing deduction.
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Supposedly the schools have NIL advice and strategies for players. As with all coaching, some will take it to heart and some will just ignore it. I just don't think most athletes are making the IRS do anything but yawn if they screw up their tax bill.

As to how a business can get a deduction from helping a collective, I'm over my head quickly and think of everything I give as a donation, period, and my contact with my tax guy was: "This isn't deductible giving" and I consider it a personal entertainment expense. I trust the collective to get it right on their end of their tax issues too.
 
#37
#37
LAVol1 said:
I've been advocating for years that personal finance should be a mandatory college course. Too many "educated" people just don't seem to comprehend money management.
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Most people just breeze right past this…but you could not be more correct. Financial irresponsible is at an all time high. The inability to read/comprehend is fairly high too among college grads but having no clue how to deal with financial issues is a MAJOR problem as well. So I agree with you 💯%.
 
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#39
#39
JRich said:
It's a pretty safe assumption for Gen Z kids. Go check out your local public high school curriculum. You'd be hard pressed to find any significant lessons on private money management, tax codes, government or basic economics. That stuff was replaced 20 years ago.
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Umm...I graduated from Karns in 2006 (within the 20 years you said) and Econ/Gov was a required course to graduate, as it still is today.
 
#42
#42
Volador said:

IRS getting involved in the NIL?​


Aaahhhhhh, so it all makes sense now. This is why Biden hired 85,000 more IRS agents.
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All of them are targeting this mess? Or are you rule-violating the no politics clause?
 
#44
#44
Like my old boss said..."want to know where there is trouble?"...follow the money and then the G-men.
 
#47
#47
volfanhill said:
Why do you assume they don't know this already? What a strange assumption. What kind of gross assumptions are you making?
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It's not strange at all. Were you thoroughly versed in tax law at age 18 or 19? I know I wasn't even after passing a few accounting classes at UT.

Second, he's going off decades of history. There are countless stories of guys in the pros blowing through all their money and still having debts or tax burdens they can't meet. Expecting that to happen now that even younger guys are getting money is just logical.
 
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#49
#49
Batman1948 said:
And it's all reportable to the IRS
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It all ends up there, anyway. W-2's are actually filed with the Social Security Administration nowadays, which passes the info on to the IRS. They used to go directly to the IRS, back in the old days, when I started in taxes.
 
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