The Money · October 16, 2026

Your kid earned NIL money. Can you still claim them? And who files their return?

Once a sponsorship check clears, two questions show up at tax time that most guides skip: does this change our family's return, and who actually files for a 15-year-old? The IRS answers both in Publication 501. Here it is in plain English.

1. On paper, the money is your child's, not yours

The IRS is direct: "Amounts a child earns by performing services are included in the child's gross income and not the gross income of the parent." That holds even if the money landed in your account. NIL pay for posts, appearances and camps goes on your athlete's own return.

There is a parent shortcut (Form 8814) for putting a child's income on your return, but it only works when the child's income is interest and dividends. It cannot be used for NIL pay.

2. Your athlete files their own return, and you may sign it

Being your dependent does not excuse a child from filing. Publication 501 says "A dependent must also file" in certain situations, and one of them is net self-employment earnings of at least $400.

If your child cannot file because of their age, "a parent, guardian, or other legally responsible person must file it for the child." If the child cannot sign, you sign the child's name followed by: "By (your signature), parent for minor child."

The line that surprises parents: if the child does not pay the tax due on this income, "the parent is liable for the tax." That is why we say set aside about 30% of every check. The NIL tax guide →

3. Can you still claim them as a dependent?

Usually yes. NIL money only threatens one of the tests: support. To be your qualifying child, "the child can't have provided more than half of the child's own support for the year."

Support means money actually spent on the child's living costs. The IRS lists "food, lodging, clothing, education, medical and dental care, recreation, transportation, and similar necessities." The roof over their head counts at its fair rental value, and that part comes from you.

The part that helps NIL families: the IRS support worksheet counts what was spent on the child's support. Money still sitting in savings at the end of the year is listed separately, not as support. So a teenager who banks the check, or puts it in a Roth IRA, is not "supporting themselves" with it. A teenager who spends it on their own necessities might be, and a child who pays more than half of their own support is not your qualifying child.

The other tests (age, living with you, not filing a joint return) do not change because of NIL.

The 60-second version

NIL pay goes on your child's return, not yours.
They file once net self-employment earnings hit $400. You can file and sign for them.
If the tax goes unpaid, the parent can be liable for it.
Saved money is not support. Spent money can be. Keep the NIL money in its own account.
Real money moving? Get a CPA.

NIL taxes for minors: the 1099, the $400 rule, and the Roth IRA play → · Print the free NIL Starter Kit →

Sources

IRS Publication 501 (2025): "Responsibility of parent", "Child's earnings", Table 3, "Support Test (To Be a Qualifying Child)", "Total Support", Worksheet 2, and the Form 8814 election
IRS: Name, image and likeness income

NIL for Kids is an independent educational resource. General information, not tax advice. Rules and amounts change yearly; verify at irs.gov and with a qualified CPA. Last reviewed October 16, 2026.