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Manziel with “Uncle Nate” – one of many pictures making it around the Net.

“Johnny Football” Manziel had an amazing game against Alabama this past weekend.  There is no doubt he is one of the greatest ever to play college football.

Many famous athletes like Manziel have “entourages.”  The Urban Dictionary has many definitions of what an entourage is – but it is basically a “posse” that follows the celebrity wherever he/she may go.

Johnny apparently has an entourage that includes or did include a friend by that went by the name “Uncle Nate.”

Dallas Morning News staff writer Brad Townsend wrote an article titled “Johnny Manziel aide Nate Fitch, aka ‘Uncle Nate’: Who is he? Should A&M fans worry?

According to this article Uncle Nate is a friend of Manziel’s from middle school and a high school drop out.  But from news accounts, he appears to have entrepreneurial skills, including allegedly arranging autograph sessions for Manziel with memorabilia brokers.

For instructional purposes, I assume the following hypothetical fact pattern:

  • Uncle Nate arranges for Manziel to sign memorabilia with broker X.  Uncle Nate takes care of everything.  Nate makes all the calls, arranges for transportation, buys the Sharpies.  He even takes care of collecting the fee.  The only thing Manziel touches is the Sharpie.

Well whose money is it?  Is it Uncle Nate’s money?  I suppose an argument could be made that Johnny was just trying to help out his high school drop out friend.  Maybe it is just a gift.  More specifically a gift of property (his autographs).

The Supreme Court has defined a gift to proceed from a detached and disinterested generosity out of affection, respect, admiration, charity or like impulses.  Maybe he really just intended to do a gigantic favor for his friend.  If a gift, Johnny Football’s original signature is certainly valuable.  In doing a quick Google search I found a Texas A&M bumper sticker signed by Manziel that was going for $117.  Clearly there is value in Manziel’s signature.

So if it is a gift – should Manziel file a gift tax return?  Probably.

On the other hand, if it is not a gift and Uncle Nate is just a strawman – then what?

Well, I would say the income needs to be reported by Manziel.  If he doesn’t he could be looking at a tax evasion charge.  The elements of this offense are:

  1. An attempt to evade or defeat a tax or the payment of a tax;
  2. An additional tax due and owing; and,
  3. Willfulness.

Focusing on element one – the government often looks to “badges of fraud” to prove their case.  The typical examples are:

  1. Keeping a double set of books.
  2. Making false or altered entries.
  3. Making false invoices.
  4. Destruction of records.
  5. Concealing sources of income.
  6. Handling transactions to avoid usual records.
  7. Any other conduct likely to conceal or mislead.

It probably wouldn’t be a huge stretch to argue that using Uncle Nate and Manziel’s hypothetical arrangement could be viewed as “handling transaction to avoid usual records” or “any other conduct likely to conceal or mislead.”  Manziel may not be trying to hide or avoid the IRS, but he may have been trying to hide from or avoid the NCAA.  Uncle Nate is not out of the woods either – he has some exposure as well.  He could be brought in under a conspiracy charge.

Hypothetical situations aside, it sure is fun to watch Manziel play.  Hopefully he never gets himself in any trouble.