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Georgia bill would exempt NIL dollars from income tax

Nakos updated headshotby:Pete Nakos•about 16 hours•

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Georgia (8)
Georgia students and mascot during the Bulldogs' win over Tennessee Saturday night, November 17th (Photo: Conor Dillon / UGA Sports Communications)

A new Georgia state Senate bill filed on Monday would exempt NIL compensation received by college athletes from the state income tax. Introduced by Senators Brandon Beach, Greg Dolezal, Ben Watson, Carden Summers and Frank Ginn, the bill would create a distinct recruiting advantage for Georgia universities.

Georgia currently has a state income tax rate of 5.39%. This bill would also put Georgia schools on equal footing, as Tennessee, Florida and Texas are SEC states with no income tax.

The Peach State has set its institutions up for success in the NIL era. Georgia Gov. Brian Kemp signed an executive order in September prohibiting the NCAA from taking “adverse action” against an institution for compensating an athlete for NIL.

Georgia is just the latest state to craft a bill that would put its universities and athletes at an advantage against the NCAA. Institutions across the country are operating under a patchwork of state laws. Lawmakers in Missouri and Texas have passed bills in recent years to prevent the NCAA from launching investigations into NIL activities. Missouri’s NIL law even allows high school recruits to enter into NIL deals and start earning endorsement money as soon as they sign with in-state colleges.

“Student-athletes in the State of Georgia should compete on a level playing field and not forgo compensation available to student-athletes in other states while the settlement is pending,” Kemp’s executive order stated.

NCAA President Charlie Baker and college sports leaders continue lobbying lawmakers on Capitol Hill for a federal NIL bill. Meanwhile, the House v. NCAA settlement is expected to start on July 1, but has to earn final approval this spring. Institutions will share $20.5 million in Year One of revenue sharing, with most Power Four schools expected to share $15 to $17 million on their football rosters.

If college athletes at Georgia and Georgia Tech can land a state income tax break, that provides both schools a competitive recruiting advantage.