In a bipartisan move, U.S. Senators Marsha Blackburn and Maria Cantwell have introduced the Helping Undergraduate Students Thrive with Long-Term Earnings (HUSTLE) Act, with the intent of aiding college athletes in capitalizing on their newfound economic opportunities. Following the NCAA's decision to allow student-athletes to profit from their name, image, and likeness (NIL), the proposed legislation seeks to provide financial literacy and safeguard their earnings from potential exploitation. "The HUSTLE Act would allow college athletes to invest their earnings in a tax-advantaged account that grows over time, strengthen financial education, and create safeguards to prevent exploitation by dishonest agents," Senator Blackburn stated.
Since the Supreme Court's 2021 affirmation of athletes' rights to their NIL, the collegiate sports marketplace has boomed, crossing the $1.2 billion mark in 2023-2024 and potentially exceeding $2.5 billion in the next few years. These numbers reflect a drastic shift from the days when student-athletes could not entertain basic sponsorships. However, a 2022 NCAA survey showed that nearly half of the over 9,800 athletes polled recognized a need for educational resources on tax and financial literacy, and notably, only nine percent had met with a financial counselor, highlighting a discrepancy between income and guidance.
The HUSTLE Act proposes several key measures, such as allowing NIL income contribution to an investment account, subject to annual gift-tax exclusion limits, with tax-free growth. Additionally, up to $35,000 of unutilized funds could be rolled over into an IRA or retirement savings vehicle once the athlete has been out of college sports for at least a year. "This bill focuses in on the financial security and safety of college athletes who – finally – are earning compensation for their name, image, and likeness (NIL)," Senator Cantwell articulated.
The legislation would require trustees to provide financial education to help athletes manage their NIL-related savings responsibly. It also directs the U.S. Department of the Treasury to establish regulations to prevent misuse, ensure accurate reporting, monitor contribution limits, and define any additional qualified expenses. As part of its broader protections, the HUSTLE Act proposes updates to the Sports Agent Responsibility and Trust Act by imposing caps on agent fees, requiring agents to register with a state, and prohibiting deceptive practices that could influence athletes’ decisions. The bill also calls for athletic associations to maintain a public, searchable online registry of registered and certified athlete agents to increase transparency for athletes and their families.
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