NIL 101: A Family's Guide to Navigating Name, Image, and Likeness Deals

Written by College Flight Path®

If your student-athlete has college recruiters calling,  or even if they are just building a following as a standout in their sport, you probably heard the term "NIL" thrown around. Name, Image, and Likeness (NIL) rights let college athletes get paid for using their personal brand: their name, their photo, their social media presence, even their signature on a jersey. Since the NCAA opened the door to NIL compensation on July 1, 2021, it has grown into a fast-moving, often confusing corner of college sports: one that now intersects directly with recruiting, financial aid, and eligibility decisions (EPGD Business Law).

At College Flight Path, families often ask us how NIL fits into the bigger college-planning picture. Here's a practical, best-practice walkthrough of how the NIL process actually works, what to watch out for, and how to get started the right way.

What NIL Actually Covers

NIL stands for three related but distinct rights:

Name — using an athlete's identity in ads, jerseys, or social posts.

Image — photos or video used in promotions.

Likeness — anything representing the athlete, including avatars, cartoons, or video game characters (BeyondNIL).

It's important for families to understand that NIL money is not the same as the direct payments schools can now make to athletes under the 2025 House v. NCAA settlement. That settlement lets schools share revenue with athletes directly (up to roughly $20.5 million per school annually, a cap expected to climb toward $32.9 million by 2034–35), but this is separate from — and paid on top of — NIL deals with outside brands, boosters, or collectives (Horgan Law Firm;The NIL Standard).

The NIL Process, Step by Step

1. Learn the rules before doing anything else

NIL activity is governed by a patchwork of NCAA guidelines, state laws, and each school's own institutional policy — there's still NO single federal NIL law. Before an athlete signs anything, they (and their family) should know:

• What their specific school allows and requires

• What their state's NIL law says

• What the NCAA and College Sports Commission (CSC) require for reporting and review

Most universities now have NIL compliance staff or an NIL department that can walk athletes through the basics of branding, finances, and compliance.

2. Build a genuine personal brand

Brands and collectives look for authenticity, not just follower counts. Best practice is to:

• Clean up and grow social media presence across platforms like Instagram, TikTok, YouTube, and X

• Decide what values and personality the athlete wants to project

• Highlight interests outside of sports (music, fashion, entrepreneurship, community work) that make the athlete relatable

• Prioritize engagement over raw follower numbers

3. Start local, then grow

Athletes don't need to be superstars to earn NIL income. Many of the most accessible opportunities are local and community-based rather than national campaigns:

• Local restaurant, gym, or business partnerships

• Autograph signings and paid appearances

• Branded merchandise

• Camps and clinics for younger athletes

• Content creation (podcasts, YouTube, blogs)

A strong local or university following is often enough to attract small business partners, and these smaller deals are a good way to learn the ropes before bigger opportunities arrive.

4. Understand where NIL money comes from

Compensation must come from third parties — never directly from the school. Common sources include:

• Brand endorsement deals

• Social media partnerships

• Event organizers and appearance fees

• Merchandise royalties

• NIL collectives: booster- or fan-funded groups that pool resources to create opportunities for athletes at a given school

Collective deals get extra scrutiny because they're often affiliated with the athlete's own school, and school-affiliated payors face stricter fair-market-value review than independent, unaffiliated sponsors.

Disclosure and Compliance: The Part Families Can't Skip

This is the area with the most serious consequences if it's ignored.

• Disclosure is mandatory. Athletes must disclose NIL deals to their school to stay compliant.

• The $600 threshold matters. Any third-party NIL deal worth $600 or more must be submitted for review through the NIL Go clearinghouse, run by the College Sports Commission in partnership with Deloitte.

• Deadlines are strict and vary by athlete status:

  • Prospective student-athletes (including high schoolers and JUCO transfers) must disclose qualifying deals within two weeks of enrollment.

  • Current Division I athletes must submit documentation within five business days of signing a deal.

• What the CSC checks: Whether the payor is affiliated with the athlete's school, whether the deal has a genuine business purpose (promoting a for-profit good or service at fair market value), and how the deal compares to similar transactions in the market.

• Expect delays. The CSC has reportedly operated with a small staff, a backlog of pending approvals, and inconsistent public reporting on deal volume, so families should build extra review time into any deal timeline rather than assuming quick turnaround.

Two rules that trip up families most often:

• NIL deals cannot be tied to athletic performance: pay can't be structured as a bonus for stats or wins.

• NIL cannot be used as a recruiting inducement: a deal can't be offered specifically to lure an athlete to a particular school or program (EPGD Business Law).

Violations of any of these rules can result in fines, probation, scholarship reductions, or loss of eligibility.

How NIL Valuation Actually Works

Families are often surprised at how many factors go into determining what an athlete's NIL is "worth." Common valuation inputs include:

For context on scale: the average disclosed NIL deal in 2024 was valued at $2,618, while high-profile athletes like Shedeur Sanders and Livvy Dunne had estimated NIL values in the millions, showing just how wide the range really is. Most families should expect something much closer to the average than the headlines.

Contracts: What to Look For Before Signing

Never sign an NIL contract that hasn't been read and understood, ideally with an NIL-experienced attorney or agent reviewing it. Key clauses to check:

• Compensation and payment schedule: clearly stated amounts and timing

• Exclusivity: does the deal block the athlete from working with competing brands, and for how long?

• Term and renewal: avoid unlimited or overly long automatic renewals

• Deliverables: exact number of posts, appearances, or content pieces required

• Regulatory contingency: the deal should be explicitly conditioned on CSC/NIL Go approval, with clear terms for what happens if approval is delayed or denied

• Exit and eligibility clauses: what happens if the partnership doesn't work out, or if the athlete's eligibility changes due to a transfer or waiver dispute

Taxes: Treat NIL Income Like Real Income

NIL earnings are taxable: whether paid in cash, product, or perks. Best practice for families includes:

• Keeping detailed records of every payment and related expense

• Making quarterly estimated tax payments where required

• Considering a separate business entity (LLC or S-Corp) and dedicated bank account once income becomes significant

• Consulting a tax professional, since NIL income often involves self-employment tax considerations that a typical student's tax situation wouldn't 

Common Pitfalls to Avoid

• Signing a contract without fully understanding its terms

• Missing the disclosure deadline (two weeks post-enrollment, or five business days for current Division I athletes)

• Accepting NIL pay directly from the school, or a deal structured to reward athletic performance

• Treating follower count as the only measure of value

• Ignoring quarterly taxes or mixing NIL income with personal funds

• Agreeing to overly broad exclusivity clauses that block future opportunities

• Overcommitting to NIL work at the expense of the athlete's sport and academics

• Assuming eligibility is guaranteed — transfer rules, waivers, and ongoing litigation (like recent Five-Year Rule cases) can affect an athlete's availability and marketability with little warning

A Simple Starting Checklist for Families

1. Review your school's NIL policy, your state's NIL law, and NCAA/CSC requirements.

2. Meet with your school's NIL compliance office before pursuing any deal.

3. Build an authentic, consistent personal brand across social platforms.

4. Start with small, local partnerships to learn the process.

5. Document social metrics, engagement, and comparable deals to support fair-market-value claims.

6. Have every contract reviewed by a professional before signing.

7. Disclose any deal worth $600 or more through NIL Go within the required window.

8. Set up basic financial systems: separate accounts, record-keeping, and a plan for quarterly taxes.

9. Stay alert to eligibility news that could affect the athlete's status mid-deal.

The Bottom Line

NIL has become a real, if complicated, part of the college athletics landscape, and increasingly, part of the college planning conversation for families evaluating athletic scholarships, recruiting offers, and financial aid packages together. The best protection against costly mistakes is the same advice that applies to college admissions generally: understand the rules before you commit, get things in writing, and don't be afraid to ask for professional guidance before signing anything. If NIL considerations are part of your family's college search, College Flight Path is happy to help you think through how it fits into your overall college and financial-aid strategy.

Book a free 15-minute consultation with College Flight Path® HERE