Updated: Richard Burr is, in fact, a Republican Senator from North Carolina, not a Democrat.
College athletes are currently prohibited from profiting on their likenesses, images, and names – but not for long. The NCAA Board of Governors voted today to allow those students to earn income based on their fame.
This conversation has been going on for a few years, and California has already passed a law that would allow students to earn money in this manner. It’s set to go into effect in 2023.
The Associated Press tweeted a link to their story today that describes the Board of Governors decision. A little over one hour had passed before Senator Burr, a Republican from North Carolina, had plans to tax scholarships as income. One. Hour.
Leave it to Democrats to target young student athletes to help fill the federal coffers. Hard to see how that will jive when Bernie’s “free” college program goes through. What will they tax then? Isn’t college going to be free for everyone soon? Or would athletes not get free education? Would every student be responsible for paying income taxes on the cost of them attending “free college”?
This smash-and-grab tax idea came from a Republican Senator from North Carolina, which is surprising. Usually these half baked ideas come from Democrat circles.
Leaving aside the fact that Taxation is Theft for a second, Senator Burr forgets a few things. First, their actual income made from their likeness, image, or name would already be subject to income taxes, because it’s income. These taxes would fall at the federal and state level, in most states. Second, selectively taxing scholarships used for education expenses is immoral, and probably unconstitutional. Tax one tax them all, or just tax none.
According to CreditKarma.com, there are only four situations in which your scholarship is taxable income. They include:
- 1. Your school isn’t eligible, or you’re not pursuing a degree
- 2. The funds exceed your qualified education expenses
- 3. The funds are earmarked for non-qualified expenses
- 4. The funds are considered payment for services
You could, theoretically, make the case that student athletes fall under the fourth category. But that would mean all student athletes. Their scholarships are tied to their athletic performance for the school. Some of those scholarships already fall under the third category, for room & board expenses are not tax exempt when it comes to scholarships.
We’ll see how the NCAA rules regarding the earning of income on your own likeness, image, and name pan out. Guess we’ll see how many smash and grab tax plans come about as a result as well.