HUSTLE Act

This bill creates tax-advantaged investment accounts for student-athletes to save income from their name, image, and likeness (NIL) and reforms rules for athlete agents. It also allows student-athletes to sue agents who violate the law.

Sec. 2, NIL investment accounts: The bill adds a new part to the tax code for NIL investment accounts. An eligible athlete (a student at a participating college who plays an amateur or collegiate sport) can contribute cash from qualified NIL income (e.g., endorsements, appearances, social media) to a trust account. Contributions are limited to the annual gift tax exclusion amount and can only be made for up to five years after first receiving NIL income. The athlete can elect to exclude contributed NIL income from gross income and from self-employment tax. Distributions before graduation or transfer to a non-participating school are taxed as ordinary income; after graduation or such transfer, up to a certain amount per year is taxed at the long-term capital gains rate. An extra 10% tax applies to non-qualified distributions, but exceptions exist for death, disability, qualified expenses (career transition costs, higher education, medical expenses), and rollovers. Accounts can be rolled over to another NIL account for the same or a family-member athlete.

Sec. 3, Student athlete sports agent reform: The bill amends the Sports Agent Responsibility and Trust Act to add new definitions (athletic association, athletic department, college athletic competition, conference, institution, varsity intercollegiate sport) and new prohibited acts for athlete agents. Agents cannot represent a student for an endorsement contract without a written agency contract that includes names, term, registration info, and fee; cannot charge a fee over 5% of the contract value; cannot have a contract term beyond the athlete's eligibility; cannot entice enrollment or transfer by misrepresenting NIL opportunities; and cannot make false statements. Agents must register with a state before representing a student for an endorsement contract. Athletic associations must maintain a public online registry of registered agents.

Sec. 4, Private right of action: The bill adds a new section allowing any current or former student athlete to sue an athlete agent in federal or state court for violations of the Act (except certain FTC violations). If the athlete wins, the court can award actual damages, reasonable attorney's fees and costs, and injunctive or equitable relief. Pre-dispute arbitration agreements and joint-action waivers are invalid and unenforceable for disputes under this Act, and a court (not an arbitrator) decides whether this applies.