On February 3, 2025, the Georgia Senate introduced a bill that would exempt Name, Image, and Likeness (NIL) compensation received by college athletes from state income tax. The bill, sponsored by Senators Brandon Beach, Greg Dolezal, Ben Watson, Carden Summers, and Frank Ginn, aims to relieve college-athletes in the state of Georgia from the 5.39% state income tax on their NIL compensation.
For those not familiar with the Name, Image, & Likeness (NIL), a law passed in 2020 allowed for student-athletes to be paid for the use of their name, image, and likeness. Since collegiate athletes receive compensation, they are required to pay federal income taxes and state taxes.
States within the Southeastern Conference, such as Tennessee, Texas, and Florida, do not have an income tax. To assist recruitment to college athletics within the state, the Georgia Senate is striving to level the playing field. Considering that Georgia’s highest income tax rate is 5.39%, a tax relief would offer substantial savings for athletes in the highest tax bracket. At the same time, the state aims to capitalize on the success of their collegiate athletic programs, along with the attention and revenue they generate, while offsetting the revenue they are prepared to forgo.
The state of Georgia has already taken significant steps to ensure its student-athletes are well-supported. In September 2024, Governor Brian Kemp signed an executive order prohibiting the NCAA from taking “adverse action” against institutions for compensating athletes.
Withum will be monitoring this situation closely, eagerly awaiting the ruling on the bill and its potential effects moving forward.
Author: Spencer Anapol | [email protected]
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For more information on this topic, please contact a member of Withum’s Professional Sports Services Team.
