---
title: "From NIL to Nest Egg: Smart Retirement Moves for Student-Athletes"
description: Student athletes with NIL or revenue-sharing income can cut taxes and build wealth with smart retirement planning.
---

[Gross Mendelsohn Blog ](https://www.gma-cpa.com/blog)

# [From NIL to Nest Egg: Smart Retirement Moves for Student-Athletes](https://www.gma-cpa.com/blog/nil-retirement-for-student-athletes)

 Written by [Tom Harvey](https://www.gma-cpa.com/blog/author/tom-harvey) | Nov 21, 2025 1:19:00 PM

Collegiate athletes with NIL (Name, Image and Likeness) and revenue-sharing income have unique tax-favored retirement planning opportunities. The strategies differ slightly depending on whether the athlete operates under a Schedule C (sole proprietorship) or an S corporation structure, but both can offer powerful ways to build long-term wealth and lower taxable income each year.

### Retirement Strategies: Schedule C vs. S Corp

 

| Structure | Key Retirement Options | Tax Advantages | Planning Points |
| --- | --- | --- | --- |
| Schedule C | SEP IRA, Solo 401(k), Roth IRA | Max deductions against earned income | Simpler setup, deduction caps |
| S Corp | Solo 401(k), SEP IRA, Roth IRA | Split salary / distribution for FICA savings | Payroll / owner salary needed |

 

### Schedule C (Sole Proprietorship)

- Athletes report income on Schedule C and pay self-employment tax on net earnings over $400
- They qualify for retirement options such as a Solo 401(k) or SEP IRA, potentially allowing up to $69,000 in total contributions (2024/2025 limits, including employee and employer portions)
- Roth IRAs are also available if below income phaseout levels (modified adjusted gross income must be less than $165,000 if single, or $246,000 if married filing jointly). Contributions are after-tax but provide future tax-free growth.
- Solo 401(k)s are particularly attractive — allowing large contributions and deductible amounts — because the athlete is both employer and employee

### S Corp Structure

- S corp status allows NIL earners with significant income (often advisable above $100,000/year) to pay themselves a reasonable salary and take remaining profits as distributions, which are not subject to employment tax
- The owner-employee can make both employee (salary-based deferrals) and employer (profit-based) contributions to a Solo 401(k), allowing for maximum annual retirement savings up to overall IRS limits
- S corps require payroll setup and compliance, but the FICA and self-employment tax savings can be considerable

### Top Retirement Plan Options

##### Solo 401(k)

- Available to both Schedule C and S corp filers with no employees other than the owner (and possibly a spouse)
- Maximum contributions (2024/25): $23,000 employee elective deferral + employer contribution up to $46,000, capped at 100% of earned income (total $69,000)
- Allows for Roth contributions (taxed now, tax-free withdrawals) or traditional (deductible contributions, taxed at retirement)

##### SEP IRA

- Easier administration, but only employer contributions allowed — up to 25% of net earnings or $69,000, whichever is less

##### Roth IRA

- Not a business plan, but available if earned income meets certain thresholds. Up to $7,000 can be contributed after-tax (2025 limits).
- Especially attractive for young athletes expecting higher future tax rates

### Key Tax and Planning Considerations

- Retirement contributions directly lower taxable income (traditional plans) or provide tax-free growth/withdrawals (Roth versions), a huge long-term win for high-earning athletes
- S corp owners can minimize employment taxes by balancing salary/distributions but must observe reasonable compensation rules
- A Solo 401(k) often offers the most flexibility and highest contribution caps, making it the core strategy for most high-income athletes

### Key Takeaways for Collegiate Athletes

A disciplined, tax-smart retirement plan — anchored by a Solo 401(k) or SEP IRA and supplemented with a Roth IRA — can provide college athletes with NIL and revenue-sharing income a powerful foundation for long-term wealth. Choosing the right business structure, understanding tax implications, and maximizing every allowable deduction and contribution are essential steps for future financial security. Collaborating with a qualified tax advisor ensures athletes fully leverage their opportunities and stay compliant as rules evolve.

Need Help?

Contact us [here](https://www.gma-cpa.com/request-consultation?hsLang=en-us) or call 800.899.4623.

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