Recruiting Forum Football Talk IV

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#156,054
#156,054
BreatheUT said:
He was a good back anyway but people say that about him because he played for the Cowboys when they went through about a 6-7 year run as the best, and he lacked speed.
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So did Terrell Davis…didn’t matter. He kept going at you and no one got a clean lick on him. Biggest convincer of his greatness for me was when he held out after that first Super Bowl and Jerry Jones played hardball in negotiations…thinking that Lassic would ably replace him. Lost first two games of the season and Jerry paid up. Won their second straight SB and never undervalued him again.
 
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#156,067
#156,067
The world is not enough –

NIL income is considered self-employment income and there have been a number of talking heads expressing concern about the education or lack thereof for student athletes as it relates to their potential tax liabilities from NIL deals.

I looked at two cases where some speculative NIL numbers have popped up. First the case of the $2m per year California QB and second the receiver from Chicago who is rumored to be getting $105k per month.

Taxes are a shock to almost everyone starting their first job or earning their first taxable income but the shock for an 18 year old earning in excess of $1m per year would probably be worth the price of a ticket to witness. I remember the first time I had to pay taxes. I was in high school in the early 70’s and my aunt had prepared my return. She was in the business. Anyway, I think I argued with her for at least three days on why someone could take my money like that. I lost the argument.

As a minimum these kids will have to pay federal income taxes, FICA (social security) taxes, and Medicare taxes. They may also have to pay state income taxes and in some jurisdictions local (city) income taxes. For example in California the state income tax rate is 13.3% but the only city with an income tax in the state is San Francisco. In Illinois the state income tax is 5% and Chicago doesn’t have a city income tax.

Said student athlete can avoid prior residence state income tax if he or she can establish residency in a new state, one that doesn’t have a state income tax, say for example, Tennessee. The Secretary of State’s office for Tennessee lists the documentation to claim residency and it’s fairly easy with a lot of options for documentation. The simplest looks like a Tennessee driver’s license and proof of residency in university housing. Among the other several options for documentation are voter registration or vehicle registration. Only two sources are required for documentation of residency in the state of Tennessee.

FICA taxes in 2023 are estimated to be 12.4% of the first $156,000 earned. Medicare taxes are 2.9% of the first $200,000 earned and 3.8% (2.9+0.9) on all income over that first $200k. There is a special 0.9% Medicare tax assessed on high earners.

Only Tennessee, Texas, and Florida are states in the SEC without a state income tax. While some states have a flat rate and others a graduated rate, the threshold for the highest rate to kick in is extremely low so I’m only listing the applicable rates. Georgia’s rate is 5.75%, Alabama is at 5% and so is Kentucky and Mississippi. Arkansas is at 5.5%, Missouri 5.3%, South Carolina at 7.0% and Louisiana at 4.25%. I’ll assume we include this info in our recruiting pitch. I would and my 16 year old self definitely would. jmo.

I used online sources and online calculators to estimate the taxes on the speculative NIL deals for the fictitious California QB and the fictitious WR from Chicago. YMMV. jmo.

One more thing. Since our example student athletes don’t have an employer withholding taxes from their paychecks they will be required to pay taxes quarterly (1099). Imagine sitting down to write a check to Uncle Sam for up to a couple hundred thousand or so every three months. I find it hard to believe than any 18 year old isn’t going to put up at least as much a fight as I did at 16 years old, and in my case, for a whole lot less money. jmo.

These estimates assume the student athlete files his return based on his parent's current place of residency.

ScreenHunter 925.png

Remember this kids, Al Capone was directly or indirectly responsible for over 400 murders but the Feds could never nail him on a single one of them; however, they had no problem at all sending him to jail for failing to pay his taxes. TIFWIW. lol
 
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#156,069
#156,069
ChattaTNVol said:
The world is not enough –

NIL income is considered self-employment income and there have been a number of talking heads expressing concern about the education or lack thereof for student athletes as it relates to their potential tax liabilities from NIL deals.

I looked at two cases where some speculative NIL numbers have popped up. First the case of the $2m per year California QB and second the receiver from Chicago who is rumored to be getting $105k per month.

Taxes are a shock to almost everyone starting their first job or earning their first taxable income but the shock for an 18 year old earning in excess of $1m per year would probably be worth the price of a ticket to witness. I remember the first time I had to pay taxes. I was in high school in the early 70’s and my aunt had prepared my return. She was in the business. Anyway, I think I argued with her for at least three days on why someone could take my money like that. I lost the argument.

As a minimum these kids will have to pay federal income taxes, FICA (social security) taxes, and Medicare taxes. They may also have to pay state income taxes and in some jurisdictions local (city) income taxes. For example in California the state income tax rate is 13.3% but the only city with an income tax in the state is San Francisco. In Illinois the state income tax is 5% and Chicago doesn’t have a city income tax.

Said student athlete can avoid prior residence state income tax if he or she can establish residency in a new state, one that doesn’t have a state income tax, say for example, Tennessee. The Secretary of State’s office for Tennessee lists the documentation to claim residency and it’s fairly easy with a lot of options for documentation. The simplest looks like a Tennessee driver’s license and proof of residency in university housing. Among the other several options for documentation are voter registration or vehicle registration. Only two sources are required for documentation of residency in the state of Tennessee.

FICA taxes in 2023 are estimated to be 12.4% of the first $156,000 earned. Medicare taxes are 2.9% of the first $200,000 earned and 3.8% (2.9+0.9) on all income over that first $200k. There is a special 0.9% Medicare tax assessed on high earners.

Only Tennessee, Texas, and Florida are states in the SEC without a state income tax. While some states have a flat rate and others a graduated rate, the threshold for the highest rate to kick in is extremely low so I’m only listing the applicable rates. Georgia’s rate is 5.75%, Alabama is at 5% and so is Kentucky and Mississippi. Arkansas is at 5.5%, Missouri 5.3%, South Carolina at 7.0% and Louisiana at 4.25%. I’ll assume we include this info in our recruiting pitch. I would and my 16 year old self definitely would. jmo.

I used online sources and online calculators to estimate the taxes on the speculative NIL deals for the fictitious California QB and the fictitious WR from Chicago. YMMV. jmo.

One more thing. Since our example student athletes don’t have an employer withholding taxes from their paychecks they will be required to pay taxes quarterly (1099). Imagine sitting down to write a check to Uncle Sam for up to a couple hundred thousand or so every three months. I find it hard to believe than any 18 year old isn’t going to put up at least as much a fight as I did at 16 years old, and in my case, for a whole lot less money. jmo.

These estimates assume the student athlete files his return based on his parent's current place of residency.

View attachment 459303

Remember this kids, Al Capone was directly or indirectly responsible for over 400 murders but the Feds could never nail him on a single one of them; however, they had no problem at all sending him to jail for failing to pay his taxes. TIFWIW. lol
Click to expand...

Good analysis.

Their parents/guardians will arrange for tax services/CPA's to advise and handle the taxes. The net is still life changing for most of them.

It is another major reason why the SEC Axis of Evil is fighting so hard for changes to reverse the positive outcome for schools in non-personal income tax states. Will the benefit be enough to get loyal Bammers and Barners as an example to move their legislatures to changing their state tax laws? Will see. Without doing so they have to up their offers because the advisors will running numbers for the kids/families. Takes more money out of pool of funds to compete over each player.

NIL and the transfer portal (eventually collegiate free agency) changes everything.
 
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#156,071
#156,071
I wouldn’t assume everybody is a clueless jabbering idiot, which you would be if you said “I don’t see how they can take this money,” but certainly there are some. There are always people, not just athletes, who buy a new car, drive it until it runs out of gas, and then call the dealer. Plenty of people are crazy. There are some that come from a long line of grifters. Some are going to be pathological liars. But there will plenty of help provided and there will be some, I bet over half, that came from taxpaying families.
 
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#156,072
#156,072
I'm sure everyone survived the inevitable knife fights from last night.

One of the few things the announcers from last nights game got right was "Kentucky is playing with house money." That's why a tied game was so much fun for them. But midnight came and Cinderella had to pick up her pumpkin and go home.

It was kind of sad that there were no Cats fans there to enjoy Burke's HR.
 
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