Ensuring financial stability both during and after their athletic careers is a crucial concern for NIL athletes. One of the primary strategies recommended to manage financial health involves effectively handling tax liabilities.
Key Strategy: Estimated Tax Payments
To enhance cash flow management and avoid a large tax bill when the fiscal year ends, it’s best for NIL athletes to make estimated tax payments periodically. This can be done quarterly, three times a year, twice a year, or even annually.
Benefits
- Spread Out Tax Liability: By opting for estimated tax payments throughout the year, athletes can distribute their tax liabilities, making it less burdensome than facing a significant payment all at once.
- Avoid Last-Minute Stress: This strategy also alleviates the stress and financial strain of fulfilling tax obligations by the standard April 15 deadline, offering a more manageable approach to tax planning.
Adopting a proactive approach to tax payments can significantly contribute to an NIL athlete’s financial stability, ensuring they remain focused on their athletic and post-athletic careers without the looming worry of tax deadlines.
