Shan Kadkoy was quoted in a Law360 article titled “IRS Plans Outreach Campaign For NIL Income Earners.”
NIL, or name, image, and likeness, income is a fast-growing subset of civil tax controversy. Social media influencers, content creators, athletes, and entertainers who attain fame and large followings online can unexpectedly face complex tax issues. It has become more common in the 2020s to earn income from online content creation than it was a decade prior, but the nature of the relationships that content creators form with brands and other entities has evolved significantly enough to warrant IRS outreach. Collegiate athletes in particular are facing the brunt of these complexities.
The IRS currently treats student athletes as independent contractors, just like influencers and most creative professionals. Subsequently, practitioners often recommend that student athletes form a business entity if their school offers a student athlete contract.
Shan warns that student athletes may face significant administrative burdens that can be difficult to manage at such a challenging time of their lives and careers. The terms of their student athlete contracts also don’t fit a “one size fits all” approach to entity selection nor tax concerns.
"Every entity structure has pros and cons for each athlete," Shan said. "Depending on their contract, one option may be more advantageous than another."
Content creators and influencers are also generally understood to be independent, even if they work with talent agencies and creative unions, such as the Screen Actors Guild. However, student athletes, their worker status, and their rights to their own income have come under additional scrutiny by policymakers and legal scholars.
The regulatory complexity of NIL income first arose in the 2021 Supreme Court decision National Collegiate Athletic Association v. Alston, which ruled that the NCAA's restrictions on education-related benefits violated antitrust laws. The NCAA subsequently suspended their rules prohibiting student athletes from earning NIL income. NIL collectives became the norm in the aftermath of Alston, raising funds and empowering student athletes to be paid for non-game activities, such as brand endorsements and speaker fees. In 2023, the IRS issued a memorandum clarifying that NIL collectives do not qualify for 501(c)(3) status since the students are the beneficiaries of the funds raised.
Proper classification of student athletes remains a challenge. "There is a fundamental debate among policymakers on the classification of student-athletes as independent contractors or school employees," Shan said. Since students are not paid directly by their schools but by NIL collectives, this creates an additional layer of complexity in student-athlete compensation.
Schools often have significant control over student athletes' schedules, which some consider tantamount to a full-time job. Some policymakers agree with the stance that student athletes are employees due to the required meetings, training, performance assessment, and other criteria that would not denote independence. Lawmakers who disagree include Florida Rep. Gus Bilirakis, who introduced the Student Compensation and Opportunity through Rights and Endorsements Act in 2025 that would prohibit schools from classifying student athletes as employees to differentiate them from professional athletes.
The IRS plans to address these issues, and ongoing developments in NIL taxation, with their 2026 outreach campaign.
You can read the complete article here.
About Shan
Prior to joining the firm, Shan practiced at Agostino & Associates P.C. He began his legal career as a Judicial Law Clerk to the Honorable Mary Siobhan Brennan, J.T.C., in the Tax Court of New Jersey.