College Athlete Collectives on Alert After Tax Exemption Warning

The IRS disrupted the name, image, and likeness industry by releasing a memo saying many organizations that fund college athletes no longer will be considered charitable.

NIL collectives will need to decide if they want to put operations on hold, change their structure, or wait for more information from the IRS.

Name, image, and likeness collectives swept across college athletics after the NCAA adopted an interim policy in 2021 that allowed student-athletes to receive compensation for use of their NIL without hindering their eligibility.

The status and structure of NIL collectives aren’t universal. For example, The Foundation—a ...