House Settlement Approved

[SU68]

With the increase in number of scholarships, has the maximum number of coaching positions increased?

 

[upperdeck]

roster didnt get bigger just the number that can be on scholie did.

 

[longtimefan]

roster didnt get bigger just the number that can be on scholie did.

Actually, the rosters got smaller. The number of scholarship athletes has (potentially) increased, but the total number of players on rosters has been capped. Except for the grandfathering of those currently on rosters.

 

[FloridaCuse]

For those who have a subscription to The New York Times or to The Athletic:

Return of the bag man: NIL clearinghouse could revive paying college athletes under table

“I guess it would just be the same as the way things used to work,” an athletic director said. "We'd be right back where we started."

www.nytimes.com

 

[FloridaCuse]

For those who have a subscription to The New York Times or to The Athletic:

Return of the bag man: NIL clearinghouse could revive paying college athletes under table

“I guess it would just be the same as the way things used to work,” an athletic director said. "We'd be right back where we started."

www.nytimes.com

Some highlights (or lowlights) from this article:

"But in candid conversations, coaches and recruiting staffers have serious doubts that athletes will declare those deals, or do so accurately. Some have suggested that players are being encouraged not to declare deals at all, but to simply take the money and keep quiet rather than risk the clearinghouse flagging it. And if that’s the case, where do we suspect that money might be coming from?"

"Maybe the enforcement piece of the settlement will work, or at least be a more effective deterrent than previously existed. Maybe the scrutiny and punishments will be unpleasant enough to curb bag dropping or strike fear in coaches beyond their plausible deniability. Maybe the clearinghouse, over time, will force collectives to wither and players to sign legitimate NIL deals that pass muster."

"But for as long as college sports have existed, there have always been folks looking for an edge, a way to beat the system. And the best ones have always found it."

 

[FloridaCuse]

For those who have a subscription to The New York Times or to The Athletic:

Return of the bag man: NIL clearinghouse could revive paying college athletes under table

“I guess it would just be the same as the way things used to work,” an athletic director said. "We'd be right back where we started."

www.nytimes.com

Some thoughts: Maybe language can be written into the contracts (if there will be contracts) the players need to sign to get some of the $20.5 compensation that if they violate the NIL Go rules they will be dismissed from the team, the school, and will need to repay the compensation. I would assume that anyone caught not reporting payments will be ruled ineligible from any further play with a P4 team. The more serious question will be whether the school itself will be penalized.

 

[FloridaCuse]

 

[FloridaCuse]

 

[javadoc]

Some thoughts: Maybe language can be written into the contracts (if there will be contracts) the players need to sign to get some of the $20.5 compensation that if they violate the NIL Go rules they will be dismissed from the team, the school, and will need to repay the compensation. I would assume that anyone caught not reporting payments will be ruled ineligible from any further play with a P4 team. The more serious question will be whether the school itself will be penalized.

Based on a simple search, it looks like the direct payments to athletes are taxable. And that the athletes are regarded as independent contractors, so they have to withhold payroll taxes as well as income tax on their own - schools won't be doing that. Hope Fran is keeping the players advised on how to handle this.

But here's the thing now. In the old days, the bagmen were working in an environment when the student-athletes were considered fully amateur and were being "paid" in-kind through the scholarships, which were not taxable. Now, the landscape is fundamentally different IMO. The players are now much closer to being employees, and all this money, above the table - both NIL and the direct payments - is taxable. The expectation in this landscape is that money going to the players is taxable. And while it might have been true before, it is now visibly and unquestionably true that players who take those bags are committing federal tax fraud.

And I hope that someone pursues it. And that the boosters get theirs as well.

 

[longtimefan]

Based on a simple search, it looks like the direct payments to athletes are taxable. And that the athletes are regarded as independent contractors, so they have to withhold payroll taxes as well as income tax on their own - schools won't be doing that. Hope Fran is keeping the players advised on how to handle this.

But here's the thing now. In the old days, the bagmen were working in an environment when the student-athletes were considered fully amateur and were being "paid" in-kind through the scholarships, which were not taxable. Now, the landscape is fundamentally different IMO. The players are now much closer to being employees, and all this money, above the table - both NIL and the direct payments - is taxable. The expectation in this landscape is that money going to the players is taxable. And while it might have been true before, it is now visibly and unquestionably true that players who take those bags are committing federal tax fraud.

And I hope that someone pursues it. And that the boosters get theirs as well.

Time to hire accountants to handle the finances.

 

[Consigliere]

Based on a simple search, it looks like the direct payments to athletes are taxable. And that the athletes are regarded as independent contractors, so they have to withhold payroll taxes as well as income tax on their own - schools won't be doing that. Hope Fran is keeping the players advised on how to handle this.

But here's the thing now. In the old days, the bagmen were working in an environment when the student-athletes were considered fully amateur and were being "paid" in-kind through the scholarships, which were not taxable. Now, the landscape is fundamentally different IMO. The players are now much closer to being employees, and all this money, above the table - both NIL and the direct payments - is taxable. The expectation in this landscape is that money going to the players is taxable. And while it might have been true before, it is now visibly and unquestionably true that players who take those bags are committing federal tax fraud.

And I hope that someone pursues it. And that the boosters get theirs as well.

The taxation aspect seems no different from NIL deals pre-House. Essentially the taxability of direct payments from the school will be treated identically. Working with the SyraCRUZ Tailgate NIL Initiative through SU’s platform all student athletes we worked with were issued a 1099 at the end of the year detailing their NIL income. If they worked with multiple groups, the 1099 aggregated all compensation.

The big difference I see is the line between independent contractor and employee has become very blurry and seems to lean toward the employee side. When I was with IBM we were required to undergo annual education and certification on this topic and made aware of the severe consequences that could arise from treating a contractor as an employee including tax fraud. The IRS has very clear rules on this differentiation.

Worker Classification 101: employee or independent contractor | Internal Revenue Service

Tax Tip 2022-117, August 2, 2022 — A business might pay an independent contractor and an employee for the same or similar work, but there are key legal differences between the two. It is critical for business owners to correctly determine whether the people providing services are employees or...

www.irs.gov

 

[FloridaCuse]

The taxation aspect seems no different from NIL deals pre-House. Essentially the taxability of direct payments from the school will be treated identically. Working with the SyraCRUZ Tailgate NIL Initiative through SU’s platform all student athletes we worked with were issued a 1099 at the end of the year detailing their NIL income. If they worked with multiple groups, the 1099 aggregated all compensation.

The big difference I see is the line between independent contractor and employee has become very blurry and seems to lean toward the employee side. When I was with IBM we were required to undergo annual education and certification on this topic and made aware of the severe consequences that could arise from treating a contractor as an employee including tax fraud. The IRS has very clear rules on this differentiation.

Worker Classification 101: employee or independent contractor | Internal Revenue Service

Tax Tip 2022-117, August 2, 2022 — A business might pay an independent contractor and an employee for the same or similar work, but there are key legal differences between the two. It is critical for business owners to correctly determine whether the people providing services are employees or...

www.irs.gov

Thanks for your explanation of this issue. I would add one thought - based on my almost 55 years working with the tax law, including stints in government at the Office of Tax Policy of the Treasury Dept. and as a senior executive at the national office of the IRS, the line between who is an employee and who is an independent contractor isn't alway clear and while the IRS often takes the position leaning toward employee, they aren't always correct. The important thing is that in either case it's taxable and avoiding paying taxes brings the whole NIL business into the world of potential IRS enforcement. Another very key factor of whether athletes are employees is labor law. Being an employee is a key element in being able to form a union like athletes have tried to do and continue to do. The football players at Northwestern a number of years ago were not successful while I believe the basketball team at Dartmouth recently was able to get a court to say they are employees. From what I've read, the ability or not to form a union and collectively bargain is a key element of any legislation on college athletics that Congress is or may consider.

 

[xc84]

College sports are becoming less appealing to me. I used to love seeing a freshman come in, learn, work hard... and by the time he was a senior I was really excited to see his progression. I knew all the players names because I watched them for years. I loved watching a guy like Hop or Lazarus Sims work their way up and into the starting lineup. Nowadays, I hardly learn the players' names and they are gone.

 

[FloridaCuse]

College sports are becoming less appealing to me. I used to love seeing a freshman come in, learn, work hard... and by the time he was a senior I was really excited to see his progression. I knew all the players names because I watched them for years. I loved watching a guy like Hop or Lazarus Sims work their way up and into the starting lineup. Nowadays, I hardly learn the players' names and they are gone.

A day or so ago I saw an article quoting Jay Bilas who thinks the House Settlement could result in less player movement between schools as the players may be signing multiple year contracts in connection with the compensation and NIL agreements. Interesting thought.

 

[Newhouser]

I am still at a loss in seeing how this prevents the well funded schools from still dominating the less funded. The thought that everyone will play nice now is insane to me.

 

[xc84]

I am still at a loss in seeing how this prevents the well funded schools from still dominating the less funded. The thought that everyone will play nice now is insane to me.

It won’t. The rich will dominate

 

[javadoc]

It won’t. The rich will dominate

How?

The House settlement may not explicitly legislate a salary cap, but by endorsing an arrangement in which each team's total payments to athletes ae capped, it's a salary cap in everything but name. AND it's all taxable. As is NIL.

How are schools not going to "play nice" with this? The only allowable channels for athlete payment are thru the settlement's revenue-sharing structure and NIL. And NIL now has to go through an official clearinghouse and be vetted... and taxed. Any other under-handed arrangement to shuffle money to players is contravening a Congressionally-endorsed financial arrangement, and tax fraud!

Boosters acting on their own - or at the nudge-nudge wink-wink direction of the school - may try to act as conduits for the money. Let's play "who wants to be a tax cheat first", and just after Congress said, this is the way it is going to be. May very well happen, and I think the most likely way that Congress gets involved again and legislates the entire league. Hopefully we'd get criminal penalties for the boosters at that stage.

Schools can continue to spend in kind, through facilities, but I honestly don't know how much more juice there is to squeeze there.

Richer schools can pay the best coaches more and retain them on average, so that's an advantage. But not enough to dominate, as the sport exists now IMO.

I actually think the settlement framework levels the field more than it tilts it. Miscreants trying to game or circumvent the setup are not now thumbing their noses only at the NCAA.

 

[FloridaCuse]

Female Athletes Appeal House v. NCAA Settlement Approval

In the appeal, athletes argue that the terms violate Title IX, the statute governing gender equity in sports.

frontofficesports.com

 

[FloridaCuse]

 

[FloridaCuse]

At a Congressional hearing today:

 

[xc84]

How?

The House settlement may not explicitly legislate a salary cap, but by endorsing an arrangement in which each team's total payments to athletes ae capped, it's a salary cap in everything but name. AND it's all taxable. As is NIL.

How are schools not going to "play nice" with this? The only allowable channels for athlete payment are thru the settlement's revenue-sharing structure and NIL. And NIL now has to go through an official clearinghouse and be vetted... and taxed. Any other under-handed arrangement to shuffle money to players is contravening a Congressionally-endorsed financial arrangement, and tax fraud!

Boosters acting on their own - or at the nudge-nudge wink-wink direction of the school - may try to act as conduits for the money. Let's play "who wants to be a tax cheat first", and just after Congress said, this is the way it is going to be. May very well happen, and I think the most likely way that Congress gets involved again and legislates the entire league. Hopefully we'd get criminal penalties for the boosters at that stage.

Schools can continue to spend in kind, through facilities, but I honestly don't know how much more juice there is to squeeze there.

Richer schools can pay the best coaches more and retain them on average, so that's an advantage. But not enough to dominate, as the sport exists now IMO.

I actually think the settlement framework levels the field more than it tilts it. Miscreants trying to game or circumvent the setup are not now thumbing their noses only at the NCAA.

 

[OrangeXtreme]

 

[SU68]

This is a much more informative and professional interview than anything you will hear on The Manchild with Boy Green.

 

[FloridaCuse]

 

[FloridaCuse]