Bill > HB240

This bill provides a tax exemption for student athletes at postsecondary educational institutions in Alabama, specifically for income earned from the use of their name, image, or likeness (NIL). The bill defines key terms, including "student athlete" as a person playing an intercollegiate sport, and "postsecondary educational institution" as a public university or college in Alabama, excluding community colleges. Under the proposed legislation, income received by a student athlete for NIL rights that is included in their federal adjusted gross income will be exempt from state income tax. The tax exemption will be applicable for tax years beginning January 1, 2025, through December 31, 2027, and the act will become effective on October 1, 2025. This bill reflects the growing trend of allowing college athletes to profit from their personal brand and marketability, following recent national changes in Name, Image, and Likeness (NIL) regulations that permit student athletes to earn compensation for endorsements and sponsorships.

Budget and Finance

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