24. NIL Deals for High School Athletes: A Legal Gray Area

For decades, the amateur status of student-athletes was strictly guarded. If you took a dollar for an autograph, you lost your eligibility. That era effectively ended for college students in 2021, but the rules for high schoolers remain a complicated patchwork of state laws and athletic association bylaws. While a college freshman in any state can sign a sponsorship deal, a high school senior in Texas or Alabama might lose their eligibility for doing the exact same thing.

This guide breaks down exactly where Name, Image, and Likeness (NIL) stands for high school athletes today, which states have opened the doors, and the specific restrictions that families must navigate to protect eligibility.

The State-by-State Breakdown

The most confusing aspect of high school NIL is that there is no national standard. The National Federation of State High School Associations (NFHS) has had to leave regulation up to individual state bodies. As of late 2024, the United States is divided into states that explicitly permit NIL, those that prohibit it, and those currently debating the change.

States That Allow High School NIL

Currently, over 35 state associations plus the District of Columbia allow high school athletes to monetize their NIL. If you live in these areas, you can sign endorsement deals without forfeiting your spot on the team, provided you follow specific guidelines.

Notable states with permissive rules include:

California: One of the first states to legalize it via the CIF (California Interscholastic Federation).
Florida: In a major shift, the Florida High School Athletic Association (FHSAA) voted unanimously in June 2024 to permit NIL deals starting with the 2024-25 season.
New York: The NYSPHSAA adjusted its amateur rule to allow monetization.
Georgia: The GHSA Executive Committee voted to allow NIL in late 2023.

Other permissive states include Alaska, Colorado, Illinois, Louisiana, Maryland, Minnesota, New Jersey, Pennsylvania, and Virginia.

States That Prohibit High School NIL

In these states, accepting money, merchandise, or services based on athletic fame is a violation of amateurism rules. A violation here results in immediate ineligibility.

The most prominent example is Texas. The University Interscholastic League (UIL), which governs Texas public high school sports, maintains a strict ban. While Texas law allows college athletes to earn money, the legislative text specifically excludes high schoolers. A student-athlete in Texas cannot accept a paid partnership without risking their high school career.

Other states that have historically maintained restrictions or have not explicitly clarified permissive rules include Alabama, South Carolina, and Ohio (though Ohio was revisiting proposals recently). It is vital to check the specific handbook of your state’s athletic association, as these lists change rapidly.

What Is Actually Allowed? (The Rules of Engagement)

Even in states where NIL is legal, it is not a free-for-all. Associations like the FHSAA (Florida) and CIF (California) have set strict boundaries to separate commercial activity from the school itself.

The “No Affiliation” Rule

This is the most common restriction across all permissive states. An athlete can promote a product, but they generally cannot use the intellectual property of their high school.

No Uniforms: You cannot wear your team jersey in a commercial or social media ad.
No Logos: You cannot display the school logo or mascot in paid content.
No Facilities: You cannot film a commercial on the school football field or inside the gymnasium.

The Ban on “Pay-for-Play”

NIL deals must be legitimate transactions for services. You provide marketing value (like an Instagram post or an autograph session), and a business pays you.

Performance Bonuses: You cannot be paid for scoring a touchdown, hitting a home run, or winning a state championship.
Inducements: A booster or collective cannot offer an NIL deal to convince a student to transfer to a specific high school. This is heavily policed to prevent “super teams” formed by the highest bidder.

Types of Deals High Schoolers Are Signing

When people hear “NIL,” they often think of million-dollar contracts for top recruits like Arch Manning or Cooper Flagg. While the top 1% of five-star recruits do secure massive valuations, the reality for most high schoolers is much more modest.

Typical High School NIL Activities:

Social Media Influencing: Promoting a local supplement shop or clothing brand on TikTok or Instagram.
Camps and Clinics: Hosting a training session for youth players and charging a fee.
Merchandise: Selling t-shirts with their own personal logo (not the school’s logo).
Autographs: Signing memorabilia at a local card show.

According to data from platforms like Opendorse, the average transaction for a high school athlete is often in the hundreds of dollars, not thousands. It might be free gear from a local sporting goods store or a small monthly stipend from a local restaurant.

The Role of Parents and Taxes

Since the vast majority of high school athletes are minors, they cannot legally enter into binding contracts on their own. This places the legal burden on parents or guardians.

If your child earns more than $400 in net earnings from NIL activities, they are considered self-employed. This means they must file a tax return. If a business pays an athlete more than $600 in a calendar year, that business is required to issue a 1099-NEC form. Parents must be prepared to set aside roughly 25% to 30% of that income for federal and state taxes. Failing to do so can lead to surprise tax bills the following April.

Legal Risks and College Eligibility

The “gray area” mentioned in the title often refers to the intersection of state laws and NCAA eligibility. While the NCAA allows NIL, they strictly forbid “recruiting inducements.”

If a high school athlete in a permissive state signs a deal that looks like a bribe to attend a specific university (for example, a deal funded by a specific college’s booster collective), the NCAA could investigate.

Furthermore, international students on F-1 visas face severe restrictions. While they can participate in sports, earning “active income” through NIL deals while in the U.S. can violate their visa terms and lead to deportation or loss of student status.

Frequently Asked Questions

Can a high school athlete hire an agent? In many states with permissive NIL laws, athletes are allowed to hire agents for the specific purpose of negotiating marketing deals. However, they generally cannot hire an agent for professional contract negotiations (like the NBA or NFL draft) without risking eligibility.

Does NIL income hurt financial aid eligibility? Yes, it can. NIL income is reported on the FAFSA (Free Application for Federal Student Aid). If a student earns a significant amount, it increases their “Expected Family Contribution,” which could reduce the amount of need-based federal aid or Pell Grants they receive.

What happens if I live in a banned state but attend a camp in a permitted state? You are generally bound by the rules of the state athletic association where you are enrolled in school. If you live in Texas (banned) but film a commercial in California (permitted), you are still violating Texas UIL rules and could lose eligibility.

Are private schools exempt from state bans? Not necessarily. Private schools that compete in the state’s public athletic association (like the FHSAA in Florida or UIL in Texas) must follow the association’s rules. Private schools that play in independent leagues not governed by the state association set their own rules.