Tax college athletes’ scholarships if they make too much NIL money, new Burr bill says
Richard Burr, one of two former scholarship college athletes in the U.S. Senate, promised to introduce legislation if athletes were able to profit off their name, image and likeness.
Now, with college athletes signing deals with companies big and small, the North Carolina Republican has followed through, introducing the NIL Scholarship Tax Act.
“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,” said Burr, who played football at Wake Forest University in the 1970s.
“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.”
The NCAA changed its rules this summer, allowing athletes to be paid for their name, image and likeness — opening the door for them to appear in commercials or get paid to sign autographs. Thousands of athletes have signed agreements, though the majority of them are for small dollar amounts.
Clemson quarterback DJ Uiagalelei has appeared in national television commercials for Dr. Pepper. Uiagalelei, North Carolina quarterback Sam Howell and more than 70 other athletes have signed endorsement contracts with Bojangles. Ohio State quarterback Quinn Ewers reportedly signed an autograph deal that pays him more than $1 million over three years.
Burr’s legislation would only impact athletes who receive more than $20,000 from outside compensation. Those who earn more would be required to include their scholarship as income for federal taxes. Athletes pay taxes on any outside compensation already.
Burr played defensive back at Wake Forest in 1974 and 1975, according to the school. He missed the 1976 season with a knee injury suffered the previous year and played in a few games in 1977. U.S. Sen. Cory Booker, a New Jersey Democrat, played football at Stanford.
In 2019, when the NCAA first said athletes would be allowed to be compensated for their name, image and likeness, Burr tweeted that “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.”
The reaction to the tweet was widespread condemnation and mocking. But Burr has not changed his mind.
“The NCAA’s recent decision to rescind its long-standing prohibition on outside compensation will fundamentally change the landscape of college athletics,” Burr said in a statement Wednesday.
In July and August, the first two months that athletes were allowed to be compensated for name, image and likeness, football players accounted for 37.9% of all NIL activities and 60.1% of total compensation, according to OpenEndorse. Women’s volleyball players were second in both categories with men’s basketball and women’s basketball ranking third and fourth.
Burr, the top Republican on the Senate’s education committee, is in his third and final term in the U.S. Senate after serving five terms in the U.S. House. He is not running for reelection in 2022.
This story was originally published September 29, 2021 at 6:17 PM with the headline "Tax college athletes’ scholarships if they make too much NIL money, new Burr bill says."
