§ GAME · 3 MIN READ
The NIL Money Reached High School
A sixteen year old can now sign an endorsement deal in most states. Almost nobody has explained the tax bill, the eligibility rules, or who is allowed to sign.
By Culture
THE SHORT VERSION
Most state high school athletic associations now permit athletes to earn money from their name, image and likeness, with common restrictions barring school logos and uniforms, prohibiting deals tied to enrolment at a school, and excluding certain categories of sponsor. Payments are self-employment income that generates a tax obligation, and a contract signed by a minor generally requires a parent or guardian.
It used to be that a high school athlete taking money ended their eligibility. That was the whole rule and everybody understood it.
It is not the rule anymore in most of the country, and the change happened quickly enough that the guidance never caught up with it. Families are signing agreements without knowing what they cost.
Most state high school athletic associations now permit athletes to earn from their name, image and likeness. The details are set state by state, not nationally, so the first task is to read your own state association's policy rather than anything you read about another state.
The restrictions are broadly similar everywhere:
No school marks. You cannot appear in the uniform, use the logo, or present the deal as coming from the school. The athlete is the brand, not the team.
No inducement. A deal cannot be tied to enrolling or staying at a particular school. This is the one that ends eligibility fastest and it is frequently how the offer is structured without anybody saying so out loud.
Category restrictions. Alcohol, tobacco, gambling, adult content, sometimes firearms and supplements.
Disclosure. Many states require the deal be reported to the school or association within a set window.
NIL money is self-employment income.
Nothing is withheld. No employer is paying half of anything. The family that spends a four thousand dollar deal in the spring can owe a meaningful part of it the following April, plus self-employment tax, and that bill surprises people every single year.
Set aside roughly a third of every payment the day it arrives. Open a separate account for it. If the money becomes regular, talk to a tax preparer once, early, and treat the fee as part of the cost of the deal.
Products count too. A company sending free gear in exchange for posts is paying in goods, and that has a value.
A minor cannot bind themselves to a contract in the usual way, so a parent or guardian signs. That signature is real and it carries obligations.
Read for four things: how long it lasts, whether it covers you after high school, what you are required to do and how often, and whether it grants the company rights to your image beyond the campaign. A one-post deal with a perpetual likeness grant is not a one-post deal.
Beware anybody offering to represent the athlete in exchange for a cut. Agent rules for high school athletes vary by state and some arrangements end eligibility outright.
“The deal is not the money. The deal is the paperwork under the money.”
A very small number of high school athletes earn significant amounts. Most of what is realistically available is local: the auto shop, the barber, the restaurant on the corner, a few hundred dollars and a genuine relationship.
That is not a lesser version. A local sponsor who knows your family is a more durable asset at eighteen than a national brand that forgets you in a season.
Read your state association's policy in full. Open the separate account. Decide the family rule on tax set-aside before the first payment, not after.
And keep the rest of the plan intact, because the recruiting calendar has deadlines that NIL does not change, and the eligibility paperwork is what actually decides whether you can play.
- Can high school athletes earn NIL money?
- In most states, yes. Each state athletic association sets its own policy, so the governing rules are your state's, not the ones you read about elsewhere. Common limits bar school logos and uniforms and any deal tied to where the athlete enrols.
- Is NIL income taxed?
- Yes. It is self-employment income with nothing withheld, so both income tax and self-employment tax come due later. Setting aside roughly a third of each payment on arrival is the practical rule, and free product counts as income too.
- Who signs an NIL contract for a minor?
- A parent or guardian, because a minor cannot bind themselves in the usual way. The signature carries real obligations, so read the term, the deliverables, and whether the company gains likeness rights beyond the campaign.
