College athletics has entered a new era. With the implementation of direct revenue sharing on July 1, 2025, alongside the continued evolution of Name, Image, and Likeness (NIL) opportunities, student-athletes are now navigating a more complex financial environment than ever before.
For many, the 2026 tax filing season will be the first time reporting income from multiple sources, making it a critical moment for awareness, compliance, and planning.
Understanding the Shift: From Scholarships to Income Streams
The House v. NCAA settlement allows Division I student-athletes to benefit directly from certain athletics-related revenue, subject to an annual cap. For the 2025-2026 academic year, that cap is $20.5 million per institution, and is calculated as 22% of certain categories of athletics-related revenue.
Combined with NIL earnings, this marks a fundamental shift: student-athletes are no longer only scholarship recipients, many are now income earners, and in some cases, independent contractors or small business owners.
Filing Requirements: Where to Start
If a student-athlete earned income or received certain payments during the year, they may be required to file:
- Form 1040 (U.S. Individual Income Tax Return), or
- Form 1040-NR (Nonresident Alien Income Tax Return) and
- State Income Tax Returns
Filing obligations depend on income type, amount, and residency status. Determining the correct forms and jurisdictions is a critical first step.
Common Income Sources
Student-athletes may receive a variety of tax documents, including:
- W-2: Wages from employment
- 1099-NEC / 1099-MISC: Revenue sharing, NIL deals, sponsorships, and endorsements
- 1099-K: Payments processed via third-party platforms or payment apps
- 1099-INT, 1099-DIV, 1099-B: Investment income
- 1042-S: Payments to international students
Each form carries different reporting requirements and tax treatments, increasing the importance of accurate recordkeeping.
Business Expenses & Deductions
For student-athletes earning NIL income, many activities may be treated as business activities, which may open the door to deductible expenses, such as:
- Agent or manager fees
- Marketing and photography costs
- Social media and content production expenses
- Travel related to appearances or sponsorships
- Mileage and transportation
- Equipment used for content creation
- Legal and professional fees
Maintaining thorough documentation is essential to substantiate these deductions and reduce taxable income.
Education-Related Considerations
Student-athletes should also gather education-related documentation, including:
- Form 1098-T (tuition statement)
This form may support eligibility for education credits or deductions, depending on individual circumstances.
Additional Requirements for International Student-Athletes
International student-athletes often face more complex filing requirements and should be prepared to provide:
- Visa and immigration documentation
- Passport information
- Entry and exit records (Form I-94)
- Treaty-related information, if applicable
Because tax rules for international student-athletes can be more complex, professional guidance is often helpful to support accurate filings and compliance.
To ensure an efficient filing process, student-athletes should gather the following:
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Income Documentation
- W-2s
- 1099 forms (NEC, MISC, K, INT, DIV, B)
- 1042-S (if applicable)
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Expense Records
- Receipts and logs for business-related expenses
- Mileage tracking documentation
-
Personal and Financial Information
- Social Security Number (SSN) or ITIN
- Bank account and routing number
- Prior year tax return (if applicable)
- Estimated tax payments made
Incomplete documentation may delay filing and, in some cases, lead to the need for an extension.
State Tax Complexities
In addition to federal filing requirements, student-athletes may also need to consider state and, in some cases, local tax obligations. A student-athlete’s filing responsibilities may depend on where they attend school, where they are considered a resident, and where income is earned through employment, revenue-sharing arrangements, or NIL activities. Because multi-state filing issues can be complex, early review is important to avoid missed filings or unexpected tax liabilities.
Looking Ahead: Planning & Support in a New Environment
The introduction of direct revenue sharing marks a significant evolution in college athletics. As financial opportunities expand, so do the responsibilities associated with managing them.
For student-athletes, developing a foundational understanding of tax obligations is essential to long-term financial well-being. At the same time, the complexity of multiple income streams, varying tax treatments, and evolving regulations means many will benefit from professional guidance, particularly in this first year of impact.
Our Tax and Small Business Advisory (SBA) Service Lines can assist with:
- Determining filing requirements and applicable forms
- Preparing and reviewing tax returns and schedules
- Filing returns electronically or by mail
- Coordinating payment of tax balances owed
- Providing ongoing advisory and planning support
With the April 15, 2026, filing deadline quickly approaching, we encourage student-athletes to begin preparing their materials and seek guidance sooner rather than later to ensure a smooth and timely filing process.
Beyond Tax Season: Building a Strong Financial Future
As student-athletes begin to generate meaningful income earlier in their careers, tax compliance is only one piece of a broader financial picture.
In addition to our tax services, our Private Wealth Team provides wealth management, and our affiliate, High Probability Advisors, delivers investment advisory services. These services can help student-athletes develop long-term financial strategies, manage assets, and make informed investment decisions as they build their financial futures.
If you have any questions or are interested in learning more, we are here to help. Please do not hesitate to reach out to discuss your specific situation.
This material has been prepared for general, informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.
