Pennsylvania’s NIL law lets college athletes at any public or private university, college, or community college in the Commonwealth earn money from their name, image, and likeness through endorsements, appearances, social media, autographs, and merchandise, as long as they follow the state’s disclosure and category rules. The statute sits in the Public School Code of 1949, and it works alongside NCAA policies, federal tax rules, and Pennsylvania’s agent registration law. Here is what the rules actually require.
Who Is Covered
The law applies to any athlete in an intercollegiate athletics program at a postsecondary institution located in Pennsylvania. Division I, Division III, and community college athletes are all included. The school has to be in Pennsylvania, but the athlete does not have to be a state resident.
High school athletes are governed separately by the Pennsylvania Interscholastic Athletic Association. High schoolers can sign NIL deals, but with tighter limits: no deal can be tied to enrollment or team selection, no school employee, coach, booster, collective, or alumnus can arrange or fund a deal, and athletes cannot use school names, nicknames, or logos. The same product bans that apply to college athletes apply at the high school level, with firearms, ammunition, and other weapons added.
What You Can Earn Money From
Paid social media posts, autograph signings, personal appearances, camps, merchandise, and similar commercial activity are all fair game. Earning NIL income does not put a scholarship or roster spot at risk.
The one substantive limit on the deal itself is that compensation has to reflect fair market value for what the athlete actually does. NIL payments cannot function as an inducement to attend or play at a particular school. A dealership paying a quarterback a normal appearance fee for a store opening is a legitimate deal. A booster wiring a recruit six figures through a nominal “endorsement” to lock in a commitment is what the statute is written to catch. Schools themselves cannot use NIL money as a recruiting tool either.
Industries That Are Off-Limits
Pennsylvania bars NIL deals with any company or organization involved in the following categories:
- Adult entertainment
- Alcohol, including beer, wine, spirits, and alcohol-branded products
- Gambling, including casinos and sports betting
- Tobacco products and electronic smoking devices
- Controlled or dangerous substances and prescription pharmaceuticals
A contract that crosses one of these lines can be voided, and the athlete can face internal discipline from the school. Age does not matter. A 22-year-old senior cannot promote a craft brewery any more than an 18-year-old freshman can promote a casino.
The Seven-Day Disclosure Rule
Before signing an NIL deal, an athlete has to submit the full proposed contract to a designated school official at least seven days before it is executed. The disclosure must identify every party and lay out the compensation terms. That window is what the compliance office uses to check the deal against state law, NCAA rules, and existing school sponsorships.
Missing the seven-day deadline gives the school grounds to block the deal or to sanction the athlete’s eligibility. Most schools route these filings through a specific compliance officer or an online portal. Treat the deadline as firm. Athletes who get a last-minute offer and try to push it through in three days are the ones who run into eligibility problems.
Separately, NCAA Division I rules that took effect in August 2024 require athletes to disclose any NIL activity worth $600 or more to their school within 30 days of signing. That disclosure has to include contact information for every party, the services involved, the length of the contract, and the payment structure. Schools can set their own grace-period policies for missed 30-day filings.1NCAA.org. DI Council Approves NIL Reforms, Permits School Assistance With NIL Activity The Pennsylvania seven-day pre-signing filing and the NCAA 30-day post-signing filing are two different obligations, and both have to be met.
Working With Agents and Attorneys
Athletes can hire agents, financial advisors, and attorneys to handle NIL matters. Any agent doing business in Pennsylvania has to be registered under the state’s Revised Uniform Athlete Agents Act before working with an athlete.2Pennsylvania Department of State. 5 Pa.C.S. 3101-3320 – Uniform Athlete Agents Act Out-of-state agents also have to register if they recruit or solicit a Pennsylvania athlete or an athlete attending a Pennsylvania school.
Using an unregistered agent carries real consequences. The Pennsylvania Athletic Commission can impose an administrative penalty of up to $50,000 per violation. Certain prohibited conduct by an unregistered agent, such as initiating contact with an athlete, is a misdemeanor of the third degree. Any resulting agency contract is void, and the agent must return every dollar of compensation received.3Justia Law. Pennsylvania Consolidated Statutes Act 139
Federal law layers on top. The Sports Agent Responsibility and Trust Act (SPARTA) bars agents from using false or misleading information to recruit an athlete, including promising specific NIL dollar amounts, and from giving anything of value to an athlete or their family before signing. SPARTA also requires both the agent and the athlete to notify the school’s athletic director within 72 hours of signing an agency contract, or before the athlete’s next athletic event, whichever comes first. Violations can trigger civil penalties over $53,000 per infraction, and schools harmed by a SPARTA violation can sue the agent for damages, including eligibility losses.4Office of the Law Revision Counsel. 15 USC Ch. 104 – Sports Agent Responsibility and Trust
What Your School Can and Cannot Do
Pennsylvania schools cannot pay athletes directly for their name, image, or likeness, and school representatives cannot act as an athlete’s agent or negotiator. Those lines are meant to keep NIL from turning into a school-run salary or recruiting weapon.
Schools do keep some blocking authority. An institution can prohibit a deal that conflicts with an existing school sponsorship or team-wide apparel contract. If the athletic department has an exclusive Nike agreement, an athlete cannot sign with Adidas for content in school gear. Schools can also block deals that conflict with institutional values, as each school defines them.
Using school logos, official colors, or other trademarks in a deal requires separate permission, usually through a licensing agreement. Athletes who want to sell branded merchandise often work around this by creating a personal logo or sticking with generic apparel.
Since August 2024, NCAA Division I schools have been allowed to help athletes identify NIL opportunities and connect with third parties. Schools still cannot pay athletes directly for NIL, and athletes are not required to use any school-provided help. Final authority over any deal stays with the athlete.1NCAA.org. DI Council Approves NIL Reforms, Permits School Assistance With NIL Activity
NIL Collectives
NIL collectives are third-party groups, often booster- or alumni-run, that pool donor money to pay athletes for appearances, charity work, and social media promotion. Some collectives initially organized as 501(c)(3) nonprofits, but in Chief Counsel Memorandum AM 2023-004 the IRS concluded that most NIL collectives do not qualify for tax-exempt status because they primarily benefit the private financial interests of athletes rather than a charitable purpose. When a collective loses exempt status, donor contributions stop being deductible and the collective’s income becomes taxable.
Proposed NCAA rule changes tied to the House v. NCAA settlement would tighten this further. Deals involving people or entities associated with a school would need a valid business purpose and compensation in line with what a similarly situated non-athlete would receive, and they would have to be reported to a national clearinghouse within five business days of signing.5NCAA.org. Proposed Division I Rule Changes Involving Student-Athlete NIL
Taxes on NIL Income
The IRS treats NIL earnings as self-employment income. Athletes are independent contractors, and every dollar goes on a Schedule C filed with Form 1040. Athletes with at least $400 in net NIL income for the year owe self-employment tax on top of regular federal income tax.6Internal Revenue Service. Name Image Likeness
Self-employment tax is 15.3% on net earnings (12.4% Social Security plus 2.9% Medicare). Combined with federal income tax, an athlete earning meaningful NIL money can see 30% or more of the gross disappear to the IRS. Deductible business expenses, including travel to appearances, agent fees, and equipment used to make content, can reduce the taxable amount, but only for athletes who keep records through the year.
Starting in 2026, any company paying an athlete $2,000 or more in a calendar year has to report those payments on Form 1099-NEC. Income under that threshold is still taxable and still has to be reported.
Athletes who expect to owe $1,000 or more in federal tax for the year generally have to make quarterly estimated payments to avoid an underpayment penalty.7Internal Revenue Service. Topic No. 306, Penalty for Underpayment of Estimated Tax The quarterly deadlines are April 15, June 15, September 15, and January 15 of the following year.8Internal Revenue Service. Estimated Tax A sophomore who signs a five-figure deal in September and waits until April to think about taxes is looking at a large lump-sum bill and a penalty on top of it.
International Athletes on F-1 Visas
International athletes face a problem domestic athletes do not. F-1 immigration rules generally limit students to on-campus work or specifically authorized off-campus employment. NIL activity where the athlete performs a service for pay, such as an autograph session, a sponsored post, or an appearance, likely counts as employment under those rules and would violate the visa.
Purely passive income, where a company uses an athlete’s likeness without any service from the athlete, might sidestep the employment problem, but passive arrangements bump into NCAA expectations that NIL pay corresponds to actual services. The Department of Homeland Security acknowledged this tension in a 2021 notice saying it was still assessing the issue, and no formal guidance has followed. Until it does, international athletes are typically advised to do any NIL work and receive payment while physically outside the United States. Anyone in this situation should talk to an immigration attorney and the school’s compliance office before signing.