Talking Tax How Transfer Pricing Can Help Fix a Student Athlete Pay Problem
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Oct 1, 2025 In this engaging discussion, Stephen Lusch, a University of Kentucky professor specializing in accounting and transfer pricing, tackles the challenges of NIL deals for student athletes. He explores how transfer pricing can help establish fair valuations, ensuring these agreements aren't merely disguised pay-for-play. Lusch discusses the metrics needed to assess athlete value, the current lack of policing in NIL transactions, and potential tax implications. He also considers the complexities of a future where athletes might be classified as employees, presenting insights into a rapidly evolving landscape.
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Early Exposure Shaped Research Focus
- Stephen Lusch recalled growing up around college football and an early compensation scandal involving quarterback Rhett Bomar.
- That memory motivated his interest in how NIL deals are regulated and valued.
Transfer Pricing Applies To NIL Valuation
- NIL deals blur lines with pay-for-play when payments exceed market logic and come from related parties.
- Transfer pricing methods can set reasonable price ranges to identify outlier deals.
Related Parties Raise Red Flags
- Related-party NIL payments from boosters can look like disguised pay-for-play rather than genuine marketing deals.
- Establishing arm's-length ranges helps flag deals that influence recruiting or appear nonmarket.