NIL and LLCs, explained
NIL LLC: does a student-athlete need one?
What an LLC can and cannot do with NIL income, when a family may not need one yet, and what it costs to start with LLC Attorney.
$49 one-time setup fee, plus your state's filing fee and a registered-agent plan from $14.99/mo (required).
Get the NIL guide for families
Who's reading?
Showing answers for parents
- Optional attorney consults, fees extra
- Private filing option, where states allow
- Plain-English rules, dated and sourced
Educational information, not legal or tax advice. LLCAttorney.com is not a law firm.
For athletes in every sport
Pick a sport to see where NIL money often comes from and what to check.
NIL in football
Football rosters are large, so many deals pay groups of players as well as individuals.
Read more
Where NIL money often comes from
- Appearances and endorsements for local businesses, such as restaurants and car dealers
- Group licensing, where one deal pays many players on a roster for their names and likenesses together; video games are one example
- School revenue sharing, at Division I schools that opt in
What to check
- Group and individual deals can overlap. Check whether a group license limits what can be signed separately.
- Schools usually control their logos and uniforms. A post that shows them may need the school's permission.
- In Division I, deals from outside businesses worth $600 or more in total are reported to NIL Go.
General information, not legal or tax advice. Rules differ by school, division and state.
NIL in basketball
Basketball rosters are small, and many deals go to individual players.
Read more
Where NIL money often comes from
- Paid posts and appearances for brands and local businesses
- Camps, clinics and private lessons
- School revenue sharing, at Division I schools that opt in
What to check
- A revenue-sharing agreement with the school can include terms about outside deals. Read it alongside any brand contract.
- Thinking about the pro draft? NCAA rules cover agents and entering the draft. The school's compliance office can explain what applies.
- In Division I, deals from outside businesses worth $600 or more in total are reported to NIL Go.
General information, not legal or tax advice. Rules differ by school, division and state.
NIL in baseball
College players can be drafted after their junior year or at 21, so NIL deals can overlap with turning pro.
Read more
Where NIL money often comes from
- Youth camps, lessons and hitting or pitching instruction
- Endorsements for local businesses and baseball gear brands
- Autograph signings and appearances
What to check
- Check how long a deal runs and what happens to it if the athlete signs a professional contract.
- Lessons and camps are a business with customers, venues and liability. That is where an LLC often comes up.
- Free bats, gloves and gear from brands are generally taxable income.
General information, not legal or tax advice. Rules differ by school, division and state.
NIL in soccer
Many soccer players earn from the game they teach: camps, clinics and private lessons.
Read more
Where NIL money often comes from
- Youth camps, clinics and private lessons the athlete runs
- Posts for sports, fitness and lifestyle brands
- Appearances at local clubs and events
What to check
- Camps and lessons are a business with customers, venues and liability. That is where an LLC most often comes up.
- Athletes on a student visa: U.S. immigration rules can limit paid NIL work. Ask the school's international student office first.
- Free gear and products from brands are generally taxable income.
General information, not legal or tax advice. Rules differ by school, division and state.
NIL in volleyball
Volleyball NIL often lives on social media, where content deals and free products add up.
Read more
Where NIL money often comes from
- Paid posts and short videos for brands
- Free products and gear in exchange for content
- Camps and clinics, indoor and beach
What to check
- Content deals say who approves posts, how long the brand can use them and whether the deal is exclusive. Read the rights section closely.
- The IRS treats free products and gift cards as taxable income.
- A public profile means people search the athlete's name. See what an LLC filing can show in Part 5.
General information, not legal or tax advice. Rules differ by school, division and state.
NIL in track and field
Track and field mixes college rules with the rules of the sport's national and international bodies.
Read more
Where NIL money often comes from
- Footwear and apparel endorsements
- Appearances at meets, running clubs and events
- Coaching, clinics and training plans
What to check
- Schools often have their own team apparel contracts. Wearing another brand at team events can conflict with them, so check before signing a gear deal.
- Athletes who compete for a national team may also follow that sport's governing-body rules on sponsors and advertising.
- Exclusivity: one gear deal can rule out others.
General information, not legal or tax advice. Rules differ by school, division and state.
NIL in swimming
Swimmers often turn pool time into income through lessons and clinics.
Read more
Where NIL money often comes from
- Private swim lessons and clinics
- Local sponsorships and appearances
- Posts for swim, fitness and wellness brands
What to check
- Lessons need a pool. Venue agreements, insurance and liability come with them, which is where an LLC often comes up.
- Income from lessons is generally self-employment income, so self-employment tax can apply.
- Athletes who compete internationally may also follow governing-body rules on sponsors and advertising.
General information, not legal or tax advice. Rules differ by school, division and state.
NIL in golf
College golfers who play amateur events follow golf's amateur status rules as well as school and NCAA rules.
Read more
Where NIL money often comes from
- Paid posts and videos for golf, apparel and lifestyle brands
- Sponsorships from golf equipment and apparel brands and local businesses
- Appearances at charity events and club outings
What to check
- Golf's amateur status rules limit prizes and prize money. Accepting more than the limit can end an athlete's amateur status.
- Equipment deals can require playing a brand's clubs or ball. Check whether the school's team contracts limit that.
- Being paid to give golf lessons can end amateur status, with narrow exceptions. Check the rules before teaching.
General information, not legal or tax advice. Rules differ by school, division and state.
The short version
Four quick answers for parents, each linked to the full explanation below. Nothing here is a recommendation for a specific family.
- What changed in NILSince July 1, 2025, Division I schools that opt in may pay athletes directly. Deals from brands have their own reporting rules.Read Part 1: NIL now
- How athletes get paidBrand deals, appearances, camps, content and school revenue sharing. The IRS treats NIL income as generally taxable.Read Part 2: the money
- An LLC: when it helps, when not yetAn LLC can keep business and personal money apart. It does not lower taxes by itself, and some athletes may not need one yet.Read Part 4: why an LLC
- What it costs here$49 one-time setup fee plus your state's filing fee, and a registered-agent plan from $14.99/mo (required). Attorney consultations are optional and cost extra.See what's included
Part 1 of 5
What NIL is now, and what changed
NIL means name, image and likeness: money an athlete earns when a business uses their name, image or likeness. The rules changed in 2025 and are still changing, so we date every fact.
June 6, 2025
A court approves the settlement
A federal judge gave final approval to the House v. NCAA settlement, which opened the way for schools to pay college athletes directly.
June 7, 2025
Division I deal reporting begins
Division I athletes report deals from outside businesses worth $600 or more in total to NIL Go, a College Sports Commission platform, within 5 business days.
July 1, 2025
Schools may share revenue directly
Division I schools that opt in may pay athletes directly, up to $20.5 million per school for 2025-26. That cap is per school, not per athlete.
Rules differ by level and by state
College and high-school rules differ, and Division II, III, NAIA and junior-college rules differ from Division I. About 35 states have NIL policies. No federal NIL law is in force.
- Your school's compliance office, for college deals and reporting
- Your state's high-school athletic association, for high-school NIL
- Your conference or league, for any rules of its own
What this means for parents: in Division I, reporting a deal is the athlete's own obligation, with or without an LLC. The school's compliance office can tell your family which rules apply.
This is general information about public rules, not legal advice. Rules change; confirm them with the school or state association.
Rules as of October 2, 2026. Sources below.
Part 2 of 5
How athletes actually get paid
NIL money arrives through business relationships. Each one usually comes with an agreement, a way of being paid and a tax record.
Brand endorsements
Brands and local businesses
Payment to promote a product or service, often through posts or appearances. Free products count as income too.
Appearances and autographs
Event organizers and businesses
Paid time at an event, a signing or a meet-and-greet, usually under a short written agreement.
Social media and content
Brands, agencies, platforms
Payment for posts, videos or other content the athlete makes and publishes.
School revenue sharing
Division I schools that opt in
Direct payments from a school, allowed since July 1, 2025. This is separate from deals with brands, which have no cap.
Camps, lessons and clinics
Families who sign up
A business the athlete runs, with customers, venues and equipment. That brings liability questions an individual deal does not.
Licensing and merchandise
Brands and merchandise makers
Payment for the right to use the athlete's name or image on a product, sometimes as a royalty.
Every one of these is a contract to read and income to track. Part 3 covers both.
As of October 2, 2026 (IRS; College Sports Commission)
Part 3 of 5
The business side: taxes and contracts
Once money changes hands, NIL is a small business. That means tax records and contracts, with or without an LLC.
Taxes: what the IRS says
The IRS says NIL income is generally taxable, including free products, gift cards and services. It is taxable whether or not a 1099 form arrives.
NIL income can be reported on a W-2, a 1099-NEC or a 1099-MISC, depending on how the deal is set up. For payments made after 2025, a business generally files a 1099-NEC once it pays $2,000 or more in a year.
When NIL income is self-employment income, self-employment tax of 15.3% applies to net earnings, generally at $400 or more. People who expect to owe $1,000 or more usually make quarterly estimated payments.
As of October 2, 2026. Source: IRS NIL and estimated tax pages
General tax information, not tax advice. A tax professional can explain how it applies to a specific situation.
Contracts: five parts to read
Parties
Who is agreeing: the athlete, the business and anyone signing for either side.
Ask: Is the athlete, a parent or a business named?
Term
How long the agreement lasts, and how either side can end it early.
Ask: What happens after a transfer, an injury or the end of a season?
Rights granted
What the business may do with the athlete's name, image and likeness, where and for how long.
Ask: Is the right exclusive, and does it continue after the deal ends?
Deliverables
The posts, appearances or other work the athlete delivers, and by when.
Ask: Who approves the content, and what if a deadline is missed?
Payment
How much, when and how it is paid, including products, bonuses or royalties.
Ask: Does the deal need to be reported, and how will it be taxed?
If your athlete is a minor: contracts signed by minors are generally voidable, and who signs varies by state. Some associations require a parent's involvement; Ohio, for example, requires a notarized affirmation from the student and a parent.
Ask an attorney about a contract
Optional. Fees are extra and set by the independent law firm.
Want the contract questions and tax dates in one place? Get the NIL guide for families.
Part 4 of 5
Should a student-athlete form an LLC?
A limited liability company (LLC) is a business registered with a state. Whether one fits depends on facts only the family has, so here is when one can help, when it can wait and what it does not do.
An LLC can help when
- There is regular NIL income to keep apart from personal money.
- The athlete runs a business with customers or venues, such as camps or lessons.
- That business will sign leases or vendor contracts in its own name.
- A business bank account and separate records would help at tax time.
You may not need one yet when
- There is no NIL income yet, or no deal under contract.
- School, association or state rules have not been checked yet.
- It is a single small deal with no recurring work.
- The family is unsure and wants to ask a professional first.
What an LLC does not do
- It does not lower taxes by itself. By default a single-member LLC is taxed like a sole proprietorship.
- It does not replace NIL Go reporting, association disclosure or school rules.
- It does not make a contract safe to sign. Each agreement still needs reading.
If the athlete is a minor
- Contracts signed by minors are generally voidable. How that affects an NIL deal depends on state law.
- Whether a minor can own an LLC, and who signs as organizer or manager, varies by state. A parent or guardian is usually involved.
- Whether a bank opens an account for a business with a minor owner, and who signs, is the bank's decision.
Who would own and sign? Who pays for the filing does not decide who owns the LLC. An adult can generally own an LLC and sign its papers. For a minor, rules vary by state; an attorney can explain who may own, sign and manage.
Compare an LLC with a sole proprietorship
If an LLC does fit, two questions come next: what stays private, and what it costs.
General information, not legal or tax advice. Whether an LLC fits a specific athlete depends on facts we do not have.
Part 5 of 5
Privacy: what goes on public record
Forming an LLC creates a public filing. Depending on the state, it can show names and addresses, which matters for athletes whose names people already search.
The state's public records
- Without private filing
- Can show the person who signed the filing and the addresses on file, which may include a home address.
- With private filing
- In states where this applies, we sign as organizer, and our address is listed as your registered agent. Registered-agent service is part of the required plan, from $14.99/mo.
The IRS
- Without private filing
- Knows the owner through tax ID numbers on W-9s, 1099s and returns.
- With private filing
- The same. Private filing does not change what the IRS sees.
The bank
- Without private filing
- Must identify and verify the owners when a business account is first opened.
- With private filing
- The same. The bank still identifies and verifies owners.
Brands, schools and NIL Go
- Without private filing
- Know who they contract with, and see the deals the athlete reports.
- With private filing
- The same. Private filing does not hide the athlete from the brands and schools they deal with, or from NIL Go reports.
Anyone searching the athlete's name
- Without private filing
- May find a formation filing that lists a home address, plus anything posted publicly online.
- With private filing
- May find no home address on the filing, depending on the state and the registered agent used. Later reports can differ.
Private filing limits what one public record shows. It does not hide an owner from the IRS, the bank, the school, courts or contract partners, and later state reports may list names.
- Anonymous LLCs and privacy, explained
- Planning for privacy and assets
- Do anonymous LLCs report to FinCEN?
General information, not legal advice. What a filing shows depends on the state and on later reports.
What LLC Attorney provides, and what it costs
We prepare and file a standard LLC. When a question needs a lawyer, you can book an optional consultation with an independent attorney we recommend; fees are extra and set by their firm.
Starter
$49 one-time setup fee, plus your state's filing fee
Plus a registered-agent plan from $14.99/mo (required).
- Company formation and state filing
- Operating agreement
- Anonymous and private filing, where states allow
- Access to attorneys, for an additional fee
- A resolution document for opening a bank account
- Organizational minutes
Professional
$199 one-time setup fee, plus your state's filing fee
Plus a registered-agent plan from $14.99/mo (required).
- Everything in Starter
- Employer Identification Number (EIN)
- Certificate of Good Standing
Registered agent and compliance plan
From $14.99/mo
Every LLC must name a registered agent to receive state and legal mail. We serve as yours through our compliance plan, which you pick in the cart alongside Starter or Professional.
- Registered agent service
- Annual report filing (you pay only the state fee)
- Business address and mail scans
- Annual meeting minutes
Attorney consultations
Optional, fees extra
Book an optional consultation with an independent, licensed attorney we recommend. No retainer to book; fees are extra and set by the attorney's firm.
LLCAttorney.com is not a law firm. You book directly with the attorney's law firm, which is not affiliated with LLCAttorney.com.
Business Success Advisors
No charge
Business Success Advisors answer questions about the formation process at no charge. Advisors are not attorneys and do not give legal advice.
Anonymous and private filing
Varies by state
When we file, we sign as organizer, and our address is listed as your registered agent. Whether names appear depends on the state. See Part 5.
EIN (federal tax ID)
Professional
An Employer Identification Number (EIN) is a business's federal tax ID. It is included in Professional, not in Starter.
Bank account resolution
Included
A resolution document you may need to open a business bank account. Whether an account is opened is the bank's decision.
What it costs in your state
State fees vary and can change. Expedited state processing costs extra. Fees are as of the date on that state's page.
Every LLC must have a registered agent. LLC Attorney serves as yours through a compliance plan that is required with every LLC we form, from $14.99 a month. Some states also charge yearly report fees.
Educational information only. LLCAttorney.com is not a law firm and does not give legal advice.
How it works, step by step
Four steps, in order. The first one happens before you open the cart at all.
Before you start
Check the school's, the association's and the state's NIL rules first. An LLC does not change what has to be reported.
Choose your state and plan
In the cart, pick the state for the LLC and the Starter or Professional package.
Starter: $49 one-time setup fee, plus your state's filing fee and a registered-agent plan from $14.99/mo (required).
We prepare and file
We prepare your formation documents and submit them to the state.
The state sets its own processing time.
Get your documents
You receive your filed formation documents, an operating agreement and a bank account resolution.
The EIN is included in Professional.
Open a business bank account
Use your documents to apply for a business account, and keep business and personal money apart.
Approval is the bank's decision.
Questions parents and athletes ask
Short answers, sourced and dated. Open as many as you like.
For parents
Not necessarily. NIL income can be paid to an athlete as an individual and reported on a W-2 or a 1099. An LLC can help keep business and personal money apart once there is regular income or a real business, but it does not lower taxes by itself. Whether one fits depends on facts an attorney or tax professional can review.
At LLC Attorney, Starter is a $49 one-time setup fee plus your state's filing fee, which varies by state. Professional is $199 plus the state fee and adds an EIN. Attorney consultations are optional and cost extra. Every LLC we form also needs our compliance plan, which includes registered-agent service; it is required and starts at $14.99 a month. Some states also charge yearly report fees.
No retainer is needed to book a consultation through LLCAttorney.com. You can book an optional consultation with an independent, licensed attorney we recommend. Fees are extra and set by the attorney's law firm. LLCAttorney.com is not a law firm: you engage the attorney's firm directly, and that firm is not affiliated with us. It helps to bring the contract and your questions.
Contracts signed by minors are generally voidable, but how that applies to an NIL deal, and what a parent who co-signs takes on, depends on state law and the contract's terms. We cannot answer that for a specific family. A licensed attorney in your state can review the agreement before anyone signs.
It depends on the state. Most states allow some high-school NIL, a few do not, and each state's athletic association sets its own rules. In Texas, as of July 2025, students 17 and older may sign NIL agreements only with colleges. In Ohio, as of November 2025, students report agreements within 14 days. Your state association publishes its current rules.
An address on a formation filing is public record, so anyone can look it up. Depending on the state, filings can show the registered agent, the signer and sometimes a home address. Depending on the state and the registered agent used, private filing can keep a home address off the formation record. It does not hide the owner from the IRS, the bank, the school or courts, and later state reports may list names.
It can, if the rules are not followed. In Division I, continuing with a deal that was not reported or cleared through NIL Go can cost eligibility. In high school, each state association sets the rules, which commonly bar school logos and uniforms. The school's compliance office or the state association can say what applies. An LLC does not change these rules.
For athletes
Generally, yes. The IRS says NIL income is taxable, including free products and services, whether or not a 1099 arrives. Separately, Division I athletes report deals from outside businesses worth $600 or more to NIL Go within 5 business days. Those are two different kinds of reporting: one to the IRS for taxes, one to the College Sports Commission for eligibility.
Not by itself. By default the IRS treats a single-member LLC like a sole proprietorship: income goes on the owner's return, and self-employment tax still applies. Business expenses can be deductible with or without an LLC. An LLC can later elect a different tax classification; whether that helps depends on the facts, which a tax professional can review.
The IRS suggests keeping receipts and mileage logs for expenses tied to NIL income, because they may be deductible. If you expect to owe $1,000 or more when you file, quarterly estimated payments generally apply, and underpaying can mean a penalty. There is no one-size figure to set aside; a tax professional can estimate one for your situation.
NIL contracts commonly cover five things: who the parties are, how long the deal lasts, what rights you grant, what you deliver and how you are paid. An attorney can review the agreement before you sign. Through LLCAttorney.com you can book a consultation with an independent attorney. No retainer is needed to book; fees are extra and set by the attorney's firm. LLCAttorney.com is not a law firm.
Processing time is set by the state and varies, and some states offer expedited processing for an extra state fee.
Each bank sets its own requirements, and banks must identify and verify a business's owners when an account is first opened. Ask the bank for its list. Starter includes a resolution document you may need to open an account, and Professional adds an EIN. Whether an account is opened is the bank's decision.
For everyone
Brands, local businesses and event organizers pay for endorsements, posts and appearances, and Division I schools that opt in may pay athletes directly. Booster-funded collectives also pay athletes, and their deals face extra review. Payment can be cash, products or services, and may be reported on a W-2, a 1099-NEC or a 1099-MISC, depending on how the deal is set up.
We do not recommend a state, because the answer depends on facts we do not have. States differ in filing fees, ongoing reports and what appears on public records, and an LLC may also need to register in a state where it does business. Our guide to choosing a state explains the trade-offs, and a licensed attorney can advise on a specific situation.
Rules are changing. As of October 2, 2026, no federal NIL law is in force, a bill has passed the Senate, and about 35 states have their own policies. After a transfer, the new school's compliance office can explain its rules, and NIL Go reporting stays the athlete's obligation. If the athlete moves states, an attorney can say whether the LLC's filings need updating.
LLCAttorney.com is not a law firm and does not provide legal advice. This page is general information, not legal, tax or financial advice, and not a substitute for the advice of an attorney. Reading it creates no attorney-client relationship. Consultations are booked directly with independent attorneys whose law firms are not affiliated with LLCAttorney.com. Rules change and differ by state, school and association.
Get the NIL guide for families
NIL Money, Explained: A Plain-English Guide for Parents and Student-Athletes. It covers contracts, taxes, privacy and when an LLC fits.
- What is reported to whom, and when
- Questions to ask before you sign
- Who can see what on public records
Start your NIL LLC when you're ready
A standard LLC, filed for you, with your documents included and an optional attorney consultation when you need one.
$49 one-time setup fee, plus your state's filing fee and a registered-agent plan from $14.99/mo (required).
Not ready? Get the NIL guide first
Optional attorney consultations: no retainer to book; fees are extra and set by the attorney's firm.
Educational information, not legal or tax advice or a substitute for an attorney. LLCAttorney.com is not a law firm.