Protecting Student Athletes from Unexpected Tax Liability Act

Key Points

• This bill changes how student athletes receive money from deals involving their name, image, and likeness. Currently, many athletes receive the full amount and must save for taxes on their own. This plan requires companies to take out 30 percent for taxes immediately, similar to how a standard job works.
• The new rules would cover cash payments and other items like cars or equipment. If an athlete receives a gift instead of cash, the company must figure out what it is worth and withhold 30 percent of that value. This helps students avoid being hit with a massive tax bill they might not have the cash to pay.
• Students have the right to opt out of this automatic tax collection if they want to manage their own finances. Additionally, the bill waives penalties for first-year athletes who do not pay enough tax. This gives young people a chance to adjust to their new income without facing fines for simple mistakes.
• The government will review this program by the end of 2029 to see if it is working well. Officials will check if the 30 percent rate is fair for most students and if businesses are following the law. This ensures the policy stays helpful as the market for college athlete deals continues to grow.

Impact Analysis

Govbase has not yet run an impact analysis on this legislation.