Arkansas NIL law lets student-athletes at in-state colleges earn money from their name, image, and likeness through the Arkansas Student-Athlete Publicity Rights Act, codified at Arkansas Code 4-75-1301 through 4-75-1309. You can sign endorsement, sponsorship, and appearance deals, but certain industries are off-limits, every contract must be reported, and the IRS treats the money as self-employment income even though Arkansas no longer taxes it at the state level.
Who the Law Covers
You qualify as a student-athlete if you are enrolled at an Arkansas college and eligible for any varsity intercollegiate sport. You also qualify if you have been accepted for admission or signed a National Letter of Intent to attend an Arkansas institution, even before your first day on campus.1Justia. Arkansas Code 4-75-1302 – Definitions A high-school senior who commits to an Arkansas school can start pursuing NIL deals right after signing.
Someone permanently ineligible for a particular sport is not a student-athlete for purposes of that sport’s NIL opportunities. Earning NIL money also does not make you an employee of the university.2Justia. Arkansas Code 4-75-1307 – Scope
What You Can Sign
You can enter contracts and receive compensation for the commercial use of your publicity rights, which cover your name, initials, nickname, voice, signature, photograph, and likeness.3Justia. Arkansas Code 4-75-1303 – Right to Compensation The compensation comes from third parties: businesses, collectives, or individuals who want to use your identity to promote a product or service.
Your school, its foundations, and its authorized entities may identify, create, and facilitate NIL opportunities for you, but they are not required to. Some programs connect athletes with sponsors and help negotiate terms. Others take a hands-off approach. Both are lawful.3Justia. Arkansas Code 4-75-1303 – Right to Compensation
Charitable organizations that qualify as 501(c)(3) tax-exempt entities can also compensate student-athletes for NIL use.3Justia. Arkansas Code 4-75-1303 – Right to Compensation That provision creates a legal pathway for nonprofit collectives that pool donor money and pay athletes for appearances, social media posts, and other promotional work.
Earning NIL money cannot cost you your scholarship. The law also bars the NCAA, athletic conferences, or any other governing body from penalizing your school because you earned NIL income.3Justia. Arkansas Code 4-75-1303 – Right to Compensation
Industries That Are Off-Limits
Arkansas bans NIL deals connected to the development, promotion, production, distribution, or sale of the following:
- Adult entertainment, sexually suggestive products, or sex-oriented services
- Alcohol
- Gambling, including casinos, sports betting, video game wagering, and mobile betting
- Tobacco, marijuana, and vaping, including electronic smoking products and devices
- Pharmaceuticals
- Controlled substances and drug paraphernalia
- Firearms and ammunition
- Any product, substance, or method banned in competition by the NCAA, your conference, or another governing body
A contract in any of these categories is void and unenforceable under state law.4Justia. Arkansas Code 4-75-1304 – Conflicts The banned-substances category catches athletes off guard most often, because some supplement companies sell products containing ingredients on the NCAA’s prohibited list. Check any supplement product against your sport’s banned-substance rules before signing.
Lawful Industry, Still Blocked
Even a clean industry does not guarantee a valid deal. Three situations render a contract impermissible:
- The deal requires you to endorse, display, or mention a sponsor’s name, logo, product, or business during practice, competition, or other team activities.
- The deal conflicts with your school’s existing contracts or policies, such as an exclusive campus apparel agreement.
- The deal ties compensation to athletic performance, whether as a bonus for winning or points scored, or a penalty for failing to perform.
You also cannot use your school’s trademarks, logos, mascots, uniforms, facilities, trade dress, songs, or other intellectual property in an NIL deal unless the institution authorizes it. Wearing your game jersey in a sponsored Instagram post without permission could cross that line. Universities keep their normal authority to enforce academic standards, team conduct rules, and student disciplinary policies.2Justia. Arkansas Code 4-75-1307 – Scope
Reporting Every Contract
When you sign an NIL contract, you must disclose it to a designated official at your school. The disclosure must include the contract terms, conditions, the parties involved, and the compensation amounts. Your school sets the deadline and format, so check its NIL policy for the exact timeline. If you have a professional representative, that person must also independently disclose the relationship and contract details to the same institutional official.
Public universities are subject to the state’s Freedom of Information Act, which raised a concern that disclosed deal terms could be pulled through a records request. Act 839 of 2025 fixed that by exempting NIL disclosures from FOIA.5Arkansas State Legislature. Act 839 of the Regular Session Your contract details stay with you, your representative, and your compliance office.
The NCAA Layer
State disclosure does not end the reporting. Under proposed rules tied to the House v. NCAA settlement, any NIL contract or payment terms worth $600 or more must be submitted to a designated clearinghouse for review. Multiple deals with the same entity or related parties that add up to $600 or more during your eligibility period also have to be reported.6NCAA. Proposed Division I Rule Changes Involving Student-Athlete NIL
Written documentation is due within five business days of signing. Incoming freshmen have a separate deadline: no later than 14 days after initial enrollment or before the school’s first contest, whichever comes first. The clearinghouse checks whether each deal has a valid business purpose and whether the compensation is reasonable compared to what non-athletes would earn for similar promotional work. A deal designed as a recruiting inducement rather than genuine promotion fails that test.6NCAA. Proposed Division I Rule Changes Involving Student-Athlete NIL These rules are still moving through approval, so stay in contact with your compliance office.
Taxes on NIL Income
This is where athletes lose money to avoidable mistakes. The IRS treats NIL income as self-employment income, not wages or scholarship funds.7Internal Revenue Service. Name, Image and Likeness (NIL) Income Two consequences follow.
You owe self-employment tax of 15.3 percent (12.4 percent Social Security plus 2.9 percent Medicare) on your net NIL earnings, on top of regular federal income tax. And because no employer withholds anything from your NIL payments, you generally have to make quarterly estimated payments to the IRS if you expect to owe $1,000 or more for the year.8Internal Revenue Service. Estimated Taxes Missing a quarterly deadline triggers an underpayment penalty even if you pay in full at filing.
Any sponsor, collective, or business that pays you $600 or more in a year must send you a Form 1099-NEC.7Internal Revenue Service. Name, Image and Likeness (NIL) Income Amounts under that threshold are still taxable; you just may not get a form. You can deduct legitimate business expenses tied to your NIL work, including travel for appearances, professional photography for a brand deal, and agent commissions.
Arkansas State Tax Exemption
Arkansas became the first state to exempt NIL income from state income tax. Act 839 of 2025 made the exemption effective for tax years beginning on or after January 1, 2025.5Arkansas State Legislature. Act 839 of the Regular Session For 2025 and later tax years, you owe no Arkansas state income tax on NIL earnings. The federal obligations above still apply in full.
Agents and Your Right to Walk Away
You can hire an agent, athlete agent, financial advisor, or attorney to work on NIL deals, and your school cannot penalize you for it. Any representative you use must be licensed in Arkansas as applicable to their profession. Athlete agents specifically fall under the Revised Uniform Athlete Agents Act and must register with the Secretary of State.9Justia. Arkansas Code 17-16-105 – Registration as Athlete Agent – Form – Requirements
The statute also gives you a rescission right most athletes never hear about. If you leave school, lose eligibility, or stop participating in varsity sports, you can cancel an existing NIL contract or a contract with a professional representative without breach-of-contract liability. You keep any payments received before giving notice of rescission.
When the Rules Are Broken
Violations, whether by failing to disclose, signing with a prohibited industry, or tying pay to performance, void the contract. Your school can also apply its own discipline under team rules and student conduct policies.
The law creates a civil remedy on top of that. If an athlete agent or third-party licensee violates the statute and the violation causes you to be suspended or disqualified from your sport, or causes financial harm, you can sue for damages. Your institution has the same right if it is harmed. A winning plaintiff can recover punitive damages, reasonable attorney’s fees, and litigation costs.10Justia. Arkansas Code 4-75-1308 – Civil Remedy
One boundary: you can bring a civil action under this section only if you were enrolled at an Arkansas institution when the violation occurred. If a bad deal surfaces after you have already left school, this statute does not provide the remedy.