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Alan Pogroszewski Accepted to Marquette Sports Law Review

AFP Consulting, LLC is proud to announce that Alan Pogroszewski and Kari Smoker’s article, Name Image and Likeness: Three words that ended amateurism under the NCAA – and the unforeseen tax consequences is to be published in the Marquette Sports Law Review’s 2024 spring edition, which will be released in the coming months.

The article, which is Pogroszewski’s seventh published law article, focuses on the uncertainty surrounding the tax consequences of college athlete’s compensation through endorsement income.  With the lack of tax guidance from the National Collegiate Athletic Association (NCAA) and over 170,000 Division I athletes participating in 24 different sports at over 350 member schools, Pogroszewski and Smoker’s article provides critical analysis in how this income is categorized, sourced and taxed.


The first issue, Pogroszewski and Smoker address is how is this compensation to be categorized?


The key consideration is whether the income should be properly characterized as personal service income or NIL royalties.  With little guidance from neither the Internal Revenue Code (IRC) nor the Treasury Regulations to provide a clear definition, similar income for different individuals may be classified differently and as a result taxed differently.

To help answer the question, the authors look to Supreme Court cases involving professional golfers Retief Goosen and Sergio Garcia, where the Court differentiates between personal service income and royalties. Ultimately, the answer comes down to what the individual receiving the income is or isn’t required to do in order to be paid.

Sourcing & Tax

If the income is considered personal service income, there are potential ‘jock tax’ implications as it would potentially be subject to federal self-employment tax and taxable to each non-resident jurisdiction (state, county, city) where the athlete performs services, which would likely be influenced by the athlete’s college team’s schedule.

Conversely, if the income is classified as royalty income, the athlete may be subject to federal net investment income tax but would only pay tax on the income in their state of residence. Therefore, athletes living in no to low-income tax states could generate tax savings by having their NIL classified as royalties.

The article concludes with case studies comparing and contrasting the tax implications of the receiving personal service versus royalty income. The case studies look at multiple income levels as well as the impact of playing football for the Texas Longhorns compared to the University of Southern California Trojans.

For a synopsis of the article, AFP Consulting, LLC has previously published a blog post on this topic that provides a short overview of the longer article that can be found here.


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