NIL Scholarship Tax Act
Bill: S.2897 | Sponsor: Sen. Burr, Richard (R-NC)
Policy area: Taxation

Summary:
NIL Scholarship Tax Act
This bill denies the tax exclusion for qualified scholarships income to recipients of athletic scholarships at institutions of higher education who receive income in excess of 	$20,000 from their name, image or likeness in a taxable year.

To amend the Internal Revenue Code of 1986 to provide that the 
 exclusion from gross income for qualified scholarships does not apply 
   to athletic scholarships if the recipient receives certain income 
         derived from the recipient's name, image, or likeness.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``NIL Scholarship Tax Act''.

SEC. 2. TREATMENT OF CERTAIN ATHLETIC SCHOLARSHIPS AS INCOME.

    (a) In General.--Section 117(c) of the Internal Revenue Code of 
1986 is amended to read as follows:
    ``(c) Limitations.--
            ``(1) Teaching services.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), subsections (a) and (d) shall not 
                apply to that portion of any amount received which 
                represents payment for teaching, research, or other 
                services by the student required as a condition for 
                receiving the qualified scholarship or qualified 
                tuition reduction.
                    ``(B) Exceptions.--Subparagraph (A) shall not apply 
                to any amount received by an individual under--
                            ``(i) the National Health Service Corps 
                        Scholarship Program under section 338A(g)(1)(A) 
                        of the Public Health Service Act,
                            ``(ii) the Armed Forces Health Professions 
                        Scholarship and Financial Assistance program 
                        under subchapter I of chapter 105 of title 10, 
                        United States Code, or
                            ``(iii) a comprehensive student work-
                        learning-service program (as defined in section 
                        448(e) of the Higher Education Act of 1965) 
                        operated by a work college (as defined in such 
                        section).
            ``(2) Certain athletic scholarships.--
                    ``(A) In general.--Subsection (a) shall not apply 
                to any athletic scholarship if--
                            ``(i) the individual receiving such 
                        athletic scholarship received income in excess 
                        of $20,000 during the taxable year from the 
                        name, image, or likeness of such individual, or
                            ``(ii) this paragraph applied to such 
                        athletic scholarship for any prior taxable 
                        year.
                    ``(B) Athletic scholarship.--For purposes of this 
                paragraph, the term `athletic scholarship' means any 
                qualified scholarship the terms of which require the 
                recipient to participate in a program of 
                intercollegiate athletics at an institution of higher 
                education (as defined in section 102 of the Higher 
                Education Act of 1965 (20 U.S.C. 1002)) in order to be 
                eligible to receive such assistance.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after the date of the enactment of this Act.
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