Tax Write-Off

A tax write-off is an expense that can be deducted from taxable income, reducing the amount of income subject to tax.

Write-offs do not eliminate taxes entirely, but they lower the income being taxed, which can significantly reduce total tax liability.

For athletes, tax write-offs are most commonly tied to business activities, training-related expenses, and income-generating operations, not personal lifestyle spending.

Misunderstanding this distinction is one of the most common and costly tax mistakes in sports.

How Tax Write-Offs Apply in Different Leagues

NCAA / NIL Athletes

For NIL athletes, tax write-offs are where “earning money” officially turns into “running a business.”

The key distinction is that expenses must be directly tied to income generation, not personal lifestyle upgrades.

Done correctly, write-offs reduce taxable NIL income; done sloppily, they invite audits or disallowed deductions that erase the benefit entirely.

Use Cases

• NIL-related business expenses
• Content creation and branding costs
• Training, nutrition, and performance services (when tied to NIL income)
• Professional services (legal, accounting)

Example

A college athlete earns $120,000 in NIL income and spends $18,000 on branding, content production, travel for sponsor appearances, and accounting services.

Those expenses qualify as tax write-offs, reducing taxable income to $102,000, not eliminating taxes, but lowering them.

NFL

At the NFL level, write-offs become scale-driven.

The mistake isn’t missing deductions, it’s misclassifying personal spending as business activity.

Legitimate write-offs help manage tax exposure on endorsement and brand income, but contracts themselves remain fully taxable.

Structure and documentation matter more than creativity.

Use Cases

• Business entity expenses (LLCs, S-corps)
• Training facilities and performance staff
• Marketing and media costs
• Travel related to endorsements

Example

An NFL player earns $5.5 million and incurs $420,000 in legitimate business expenses tied to endorsements and brand operations.

Those expenses are written off, lowering taxable income before federal and state taxes are calculated.

NBA

NBA players often operate like full media companies, which makes write-offs both powerful and dangerous.

When expenses clearly support brand monetization, they function as intended.

When personal convenience gets mixed in, the line blurs quickly.

Clean separation between lifestyle and business is what protects the strategy.

Use Cases

• Brand management and media production
• Personal staff tied to income generation
• Endorsement-related travel
• Business use of vehicles and offices

Example

An NBA player runs a personal brand company that produces digital content and campaigns.

Studio rental, editing staff, and marketing costs are tax write-offs because they are directly tied to income production.

MLB

Long seasons and extended travel create real, defensible business expenses for MLB players.

The challenge isn’t eligibility, it’s consistency.

Write-offs must be tied to income-producing activity, not simply the fact that the athlete is traveling or training.

Longevity makes clean habits especially important.

Use Cases

• Long-season travel expenses for endorsements
• Business housing allocations
• Training and recovery services
• Professional advisory fees

Example

An MLB player signs offseason endorsement deals requiring travel and appearances.

Flights, lodging, and appearance-related expenses qualify as write-offs when properly documented.

NHL

Cross-border complexity makes write-offs essential but heavily scrutinized.

Professional fees, compliance costs, and endorsement-related expenses are legitimate, but improper allocation between countries can cause issues fast.

In this environment, write-offs are less about savings and more about staying compliant while reducing friction.

Use Cases

• Cross-border tax compliance costs
• Business-related housing
• Endorsement operations
• Professional service fees

Example

An NHL player pays U.S. and Canadian tax advisors to manage filings and compliance.

Those advisory fees are tax write-offs because they relate directly to income management.

MLS / International Soccer

For international players, write-offs often sit at the intersection of relocation, branding, and representation.

Expenses tied to earning U.S.-based income may qualify, but assumptions based on home-country rules can create problems.

Understanding what the IRS recognizes as business-related is critical.

Use Cases

• Relocation-related business costs
• Agent and representation expenses
• Brand activation expenses
• Language and media services

Example

An international player moving to MLS incurs legal and branding expenses tied to endorsement income. Those costs may qualify as tax write-offs under U.S. tax rules.

Combat Sports

Combat athletes operate as independent businesses with volatile income.

Write-offs help smooth tax exposure during high-earning fights, but aggressive deductions during inactive periods raise red flags.

The goal isn’t to erase income, it’s to match expenses accurately to earning cycles.

Use Cases

• Training camp expenses
• Coaching and sparring partners
• Fight promotion costs
• Medical and recovery services (non-insurance)

Example

A fighter pays for a private training camp and promotional content tied to a fight purse. These expenses are commonly written off against fight income.

Golf / Individual Sports

Individual athletes rely heavily on write-offs because their income is directly tied to performance and sponsorships.

Coaching, travel, and equipment are legitimate business expenses, but only when they serve competitive or income-producing purposes.

Overlap must be carefully managed.

Use Cases

• Coaching and swing analysis
• Tournament-related travel
• Equipment used for competition
• Sponsorship-related branding costs

Example

A golfer deducts coaching fees, travel to sponsor events, and equipment used for tournament play as tax write-offs tied to professional income.

Racing / NASCAR / F1

Drivers function inside brand ecosystems where sponsorships and media obligations drive income.

Write-offs support that infrastructure, but only when expenses clearly connect to revenue generation.

The larger the operation, the more important clean accounting becomes to avoid disputes over mixed-use spending.

Use Cases

• Media and sponsorship operations
• Training and simulation equipment
• Brand-related travel
• Professional services

Example

A driver incurs costs for simulator training and sponsor media days.

These expenses are written off against endorsement and racing income.

Why Tax Write-Offs Matter

Tax write-offs are not loopholes, they are rules.

Used correctly, they allow athletes to operate like real businesses.
Used incorrectly, they trigger audits, penalties, and back taxes.

The difference between smart write-offs and illegal deductions is documentation, intent, and business purpose.

Related Terms

• Appreciation
• Depreciation
• Assets vs. Liabilities
• Federal Tax
• Income Tax

Next Reads

• Why NHL Players Flock to Florida Teams: Taxes & Take-Home Pay
• Travis Hunter Net Worth Valuation 2025
• Tyrese Haliburton’s Net Worth 2025
• Luther Burden III’s Fully Guaranteed NFL Rookie Contract
• Top 5 Wealthiest Golfers of All Time

Return to Finance Glossary

The Lord is near to all who call on him,
to all who call on him in truth.
– Psalm 145:18