Fun Fact: An Olympic Gold Medal Costs U.S. Athletes $9,000 In Taxes
Gold medalists return to the United States as folk heroes, netting recognition and praise from all corners of the nation. Though there’s one particular group that these athletes probably don’t enjoy such attention from: the IRS.
Olympic athletes have to pay a small fortune in taxes for the medals they take home, though not due to the actual value of the medals themselves. The tax is attached to the prize money that accompanies a gold, silver, or even a bronze win, reports Yahoo!News.
It breaks down like this: The United States Olympic Committee rewards our Olympic medalists with cash prizes. For gold, you get $25,000. Silver is worth $15,000 and finally, bronze is worth $10,000. Conservative news magazine The Weekly Standard crunched the numbers on the price paid by Olympic winners, estimating that gold medalists like Michael Phelps pay about $8,986 for each gold win, silver winners pay roughly $5,385 and bronze winners owe the IRS $3,500 in taxes.
This is slightly outrageous, as Olympic athletes are representing our country and “fighting” for the U.S. in different ways from our armed forces (who are tax exempt when deployed overseas). Should our Olympic athletes receive the same tax breaks? Sure, they have their endorsements, and no one is arguing that they come home to the poor house. But what about Missy Franklin who hasn’t cashed in any endorsements? The ATR (Americans for Tax Reform) estimate her post-Olympic taxes to be in excess of $30,000. Fair?
Though the winnings are indeed taxable, and according to Alex Knight, a tax partner at Atlanta’s Habif, Arogeti & Wynne, “no different from winning Wheel of Fortune or the lottery,” all the fuss may be for naught, as it is hard to imagine the IRS actually chasing down Olympic athletes for unpaid taxes. “I have to imagine that would be a public relations nightmare,” Knight told Reuters.
Tags : 2012 Olympics, england, gold medalists, IRS, London, London Olympics, olympic medal prize money, olympic prize money taxes, prize money, prize money taxes, taxes, taxes on olympic medals
Posted: August 1, 2012
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Aug 1, 2012
W T H? Something needs to be done about this immediately. Not only do we NOT support our athletes, we tax them also… Maybe you should impose this same tax on, oh, say, 435 elected officials in Washington, D. C.
Aug 2, 2012
Seriously your comparing it to deployed military forces? Their overseas tax expmtion is on money earned while in a COMBAT ZONE. Sorry despite the fact that you try to make it seem other wise no one just stationed overseas get tax free income. Seriously your comparing what athletes do to the fighting armed forces? When Servicemembers start coming home to million dollar endorsement deals, or are allowed to auction off parts of their body for temporary sponsor tattoos for 10 grand, or even receive a nice hefty bonus for a job well done then you can compare the two. They should have to pay taxes it's income, it's taxable, and they still walk away with a nice little profit.
Aug 2, 2012
It's a tax on their earnings though, not on the medal itself. We could always just not pay them the $25,000 in the first place and that would eliminate the tax problem.
Aug 2, 2012
I'm sure the athlete will have a good accountant that will make sure all of the expenses involved in earning that money will be documented and deducted on their tax return. Such expenses as lodging, airfare, parking, tolls, training, uniforms, medical expenses, meals, entertainment and etc. Done right, they could probably get their income down below the poverty level and owe no taxes at all, just like a transnational corporation.
Aug 2, 2012
I just read an article, that states the athelete has to add the value of their medal before being taxed! Wow!! This is just rediculous!!!!
Aug 2, 2012
The medal is taxed also. REally dumb!
Aug 2, 2012
$9,000? NOT TRUE. The metal in the "gold" medal is only worth about $700. (It's 92% silver.) The Silver is worth about $300 and the Bronze is worth about $6.
Moreover, Olympians do not get taxed on the value of their medals and no one is suggesting they should be. They do, however, get taxed on the cash prize that is awarded by the US Olympic Committee (between $25,000 and $10,000, depending on the medal – but possibly more for certain events). They also pay taxes on any sponsorship income and prizes.
Aug 2, 2012
Military pay is not tax exempt just for being overseas. It is only tax exempt if you are deployed to a combat zone. I agree that the rate the athletes are being taxed is too high, but unless the Olympics are being held in Afghanistan, it shouldn't be tax free.
Aug 3, 2012
USA home of the brave and the taxs. What a dam shame. But still glad to be a AMERICAN… Go USA
!!!!
Aug 3, 2012
The Olympics is just pointless and as proven above costs thousands to organize and maintain.
Aug 3, 2012
thats F*ckin stupid..