As colleges and universities prepare to implement the House v. NCAA settlement, stakeholders across athletics, compliance, and legal affairs are tasked with navigating complex regulatory terrain. At the center of the conversation is a question with significant operational and legal ramifications: can payments to student-athletes under this settlement be lawfully classified as “royalty income”—especially when received by international athletes on F-1 visas?

The royalty income framing is gaining traction because it purports to offer a compliant path forward: a way to compensate athletes without triggering employment classification, payroll tax obligations, or immigration violations. But while the form of these payments can be dressed in the language of intellectual property licensing, their substance raises red flags across various legal frameworks. This article explains why “royalty income” is not the regulatory safe harbor many hope it to be, and why institutions should approach this classification with caution, especially when it comes to international student athletes on F-1 nonimmigrant visas...