In a groundbreaking move, lawmakers in Washington have introduced the Helping Undergraduate Students Thrive with Long-Term Earnings (HUSTLE) Act. This bipartisan bill is designed to help college athletes manage and save the money they earn from their personal brands.
The legislation is spearheaded by U.S. Representatives Greg Steube (R-Fla.) and Brendan Boyle (D-Pa.) in the House. Senators Marsha Blackburn (R-Tenn.) and Maria Cantwell (D-Wash.) are leading the effort in the Senate.
The bill proposes tax-exempt NIL investment accounts for student-athletes. It aims to provide a structured pathway for athletes to invest their earnings and plan for their post-collegiate careers.
This initiative is intended to help athletes build long-term financial stability.
The Need for the HUSTLE Act
The NIL era has changed collegiate sports, allowing student-athletes to profit from their name, image, and likeness (NIL). NIL deals generated over $1.2 billion during the 2023-2024 academic year.
Projections indicate this figure could surpass $2.5 billion by the 2025-2026 cycle. Despite this influx of money, financial literacy remains a challenge for young athletes.
A 2022 NCAA survey of over 9,800 athletes revealed that 49% wanted educational resources about taxes and financial literacy. Only 9% had ever met with a financial counselor.
The HUSTLE Act would require account trustees to provide athletes with annual educational materials on basic investing, financial planning, and long-term security.
Key Provisions of the HUSTLE Act
The HUSTLE Act proposes several measures to help student-athletes manage their earnings:
- Tax-Exempt NIL Investment Accounts: Student-athletes can contribute cash from endorsements, appearances, and social media deals into these accounts. These amounts are excluded from their taxable income up to the annual gift-tax limit.
- Long-Term Capital Gains Rates: After graduation, the money can be withdrawn and taxed at long-term capital gains rates instead of higher ordinary income rates.
- Roll Over Unused Funds: Athletes can roll over up to $35,000 of unused funds into an IRA or Roth retirement account after being out of collegiate sports for at least one year.
- Flexibility in Withdrawals: Students can withdraw funds before graduation without penalty if the money is used for career transition costs, higher education expenses, or qualified medical bills that exceed 7.5% of their adjusted gross income.
Support from Athletic Organizations and Universities
The HUSTLE Act has support from major athletic organizations and university administrators. Tim Buckley, Senior Vice President of External Affairs at the NCAA, highlighted that student-athletes will receive roughly $1 billion in direct financial benefits from universities this year.
The NCAA supports providing athletes with more resources to achieve long-term financial success.
Southeastern Conference (SEC) Commissioner Greg Sankey praised the bipartisan effort to build national standards. He stated that the HUSTLE Act establishes tax-advantaged NIL investment accounts that encourage financial education and responsible management of earnings.
University Athletic Departments’ Endorsement
University athletic departments in Florida have also backed the measure. Michael Alford, Vice President and Director of Athletics at Florida State University, stated that the bill aligns with their mission to develop graduates prepared to thrive after their playing careers end.
He emphasized that the legislation encourages financial education and promotes responsible stewardship of NIL earnings.
The University of Florida Athletic Association issued a statement highlighting how the act addresses the shifting landscape. They support the HUSTLE Act and appreciate Representative Steube’s leadership in advancing legislation that promotes transparency and greater accountability for sports agents.
The association encourages student-athletes to build long-term financial security through saving and investing.
Implications for the Future
If passed, the amendments to the Internal Revenue Code would apply to taxable years starting after December 31, 2025.
The U.S. Department of the Treasury would issue rules to track contributions, verify income sources, and prevent fraud.
With the HUSTLE Act, college athletes will have more tools and resources to manage their earnings responsibly.
This initiative aims to protect athletes from dishonest agents and help them safeguard their financial future.
For more information on the HUSTLE Act and its implications, you can read the full article on Florida, Pennsylvania Lawmakers Push ‘HUSTLE Act’ To Shield College Athlete NIL Millions From Taxes.
- Schools Covered
- College Football Articles
- Men's College Basketball Articles
- Men's College Soccer Articles
- Women's College Basketball Articles
- Olympic Athlete Articles
- Men's College Baseball Articles
- College Sports Media Professionals Articles
- Hall of Fame Member Articles
- Former College Player Articles
- Game Previews
