Arkansas Makes NIL Income Tax-Exempt. Will Other States Follow?
The post Arkansas Makes NIL Income Tax-Exempt. Will Other States Follow? appeared on BitcoinEthereumNews.com. FAYETTEVILLE, AR – SEPTEMBER 4: Trelon Smith #22 of the Arkansas Razorbacks celebrates after … More scoring a touchdown. (Photo by Wesley Hitt/Getty Images) Getty Images In April 2025, Arkansas became the first that taxes income to exempt NIL income from taxation. Questions arise about why they did this and whether more states will follow their lead. The Taxation of NIL Income According to On3, Arch Manning has a name, image, and likeness (NIL) valuation of $6.5 million. Meanwhile, Athlon Sports reports heralded basketball player PJ Haggerty is requesting a $4 million NIL deal in the transfer portal. The NIL money that the current group of college players demands is growing at a staggering rate, and their net take-home pay may be getting bigger as many states may soon be exempting this income from taxation. As suggested by its name, NIL income is earned income and subject to taxation. This income is not taxed differently than a barista at a coffee shop or an executive receiving a multimillion-dollar bonus. Athletes will need to pay income taxes on their NIL money at the federal level (top individual tax rate of 37% in 2025) and the state in which they earn the money. While most states tax athletes on the income earned while playing in their state for road games (also known as the jock tax), athletes tend to face the greatest tax consequences from their state of residence. For college athletes, this is the state where their school is located. As previously reported on Forbes, athletes earning NIL money in a state with no income taxation have a financial advantage over states with an income tax. While athletes still face taxation at the federal level regardless of where they live, state income tax can drastically cut into their take-home pay, as…
The post Arkansas Makes NIL Income Tax-Exempt. Will Other States Follow? appeared on BitcoinEthereumNews.com.
FAYETTEVILLE, AR – SEPTEMBER 4: Trelon Smith #22 of the Arkansas Razorbacks celebrates after … More scoring a touchdown. (Photo by Wesley Hitt/Getty Images) Getty Images In April 2025, Arkansas became the first that taxes income to exempt NIL income from taxation. Questions arise about why they did this and whether more states will follow their lead. The Taxation of NIL Income According to On3, Arch Manning has a name, image, and likeness (NIL) valuation of $6.5 million. Meanwhile, Athlon Sports reports heralded basketball player PJ Haggerty is requesting a $4 million NIL deal in the transfer portal. The NIL money that the current group of college players demands is growing at a staggering rate, and their net take-home pay may be getting bigger as many states may soon be exempting this income from taxation. As suggested by its name, NIL income is earned income and subject to taxation. This income is not taxed differently than a barista at a coffee shop or an executive receiving a multimillion-dollar bonus. Athletes will need to pay income taxes on their NIL money at the federal level (top individual tax rate of 37% in 2025) and the state in which they earn the money. While most states tax athletes on the income earned while playing in their state for road games (also known as the jock tax), athletes tend to face the greatest tax consequences from their state of residence. For college athletes, this is the state where their school is located. As previously reported on Forbes, athletes earning NIL money in a state with no income taxation have a financial advantage over states with an income tax. While athletes still face taxation at the federal level regardless of where they live, state income tax can drastically cut into their take-home pay, as…
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