College basketball players’ name, image, and likeness (NIL) valuations have soared in 2026, with the elite top 25 athletes boasting combined NIL values nearing $100 million. Leading the pack are Milan Momcilovic of Kentucky and Flory Bidunga of Louisville, each estimated to earn $6 million from NIL deals. This marks a striking increase compared to the previous year, when the highest valuation was $4.1 million and the 25th-ranked player was valued at $1.7 million. Notably, 18 players are expected to earn more from NIL than NBA superstar LeBron James will make in his first year with the Philadelphia 76ers, highlighting the rapid growth of college basketball as a commercial platform.

Taxation plays a significant role in shaping the actual take-home pay for these athletes. Because college players are considered independent contractors, they owe both federal income tax and a 15.3% self-employment tax on their NIL income, which includes cash and non-cash compensation such as merchandise or free services. States’ tax policies greatly impact players’ net earnings; some states like Florida and Texas do not levy income tax, while others such as New York impose high state and local taxes. This creates striking disparities, with after-tax income gaps of over $600,000 for players with identical NIL valuations, as seen with Florida’s Thomas Haugh and New York City’s Tounde Yessoufou.

The geographic influence on NIL tax bills is underscored by the fact that several top players now compete for prestigious basketball programs in traditional powerhouse schools, including Duke, Kansas, Kentucky, and North Carolina. Ten of the top 25 players attend schools in states with individual income taxes, whereas only three did so in the prior season. Kentucky and Louisville players face combined state and local occupational fees, adding to their tax burden despite Kentucky’s recent reduction of state income tax to 3.5%. Conversely, athletes in states without income tax pay effective tax rates around 37%, significantly increasing their after-tax earnings.

A complicating factor is the college basketball season crossing calendar years, meaning NIL income is taxed based on when payments are received, not the season during which the earnings were generated. Players must thus manage quarterly estimated tax payments accordingly. With NIL valuations continuing to climb and taxes shaping transfer decisions, states are increasingly competing to offer favorable tax treatment to attract top athletes. Arkansas already exempts NIL earnings from state tax, and others have proposed similar legislation. This ongoing race underscores how taxation is becoming a critical factor in college basketball’s evolving NIL landscape.