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HB 3871

INC TX-NIL DEDUCTION

104th Regular Session Introduced by Travis Weaver

Illinois HB 3871 increases the state tax deduction for Name, Image, and Likeness (NIL) income earned by athletes and public figures, reducing their state tax liability.

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Bill Summary · HB 3871

Legislative bill overview

HB 3871 proposes to increase the Illinois tax deduction for Name, Image, and Likeness (NIL) income earned by athletes and public figures. The bill modifies existing tax code provisions to expand the financial benefit available to individuals earning income from the commercial use of their personal brand and identity.

Why is this important

NIL rights have become a significant income source for college and professional athletes following recent legal changes that permit athletes to profit directly from endorsements and personal brand deals. This deduction affects state tax revenue and the after-tax earnings of athletes, potentially influencing where athletes choose to work and train, making it relevant to Illinois's competitiveness in attracting sports talent.

Potential points of contention

  • Tax revenue impact: Expanding deductions reduces state tax collection and may require offsetting revenue measures or budget adjustments
  • Equity concerns: The deduction primarily benefits high-earning athletes and public figures, raising questions about fairness compared to other workers and whether public policy should preferentially support this income type
  • Competitive implications: Other states may adopt similar provisions, escalating a "race to the bottom" in tax policy where states compete by reducing athlete taxation

Compiled from official sources — confirm details with the bill’s official record.

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