Aug 1, 2012 No Comments ›› Pat Dollard
(WASHINGTON TIMES) Sen. Marco Rubio introduced a bill Wednesday to eliminate the federal government’s tax on Olympic medals, saying the levy amounted to yet another way the government tries to punish those who succeed.
Athletes who win a gold medal also earn a $25,000 honorarium — and with it a $8,986 tax bill to the IRS, according to Americans for Tax Reform, which crunched the numbers. That covers both the honorarium and the tax on the value of the gold in the medal itself.
The silver medal tax comes to $5,385, and the bronze medal tax is $3,502 — including $2 for the value of the bronze medal itself, and the $10,000 honorarium.
That could leave amateur athletes — in many cases still teenagers — facing stiff tax bills when they return to the U.S.
Mr. Rubio said that shouldn’t happen.
“Our tax code is a complicated and burdensome mess that too often punishes success, and the tax imposed on Olympic medal winners is a classic example of this madness,” the Florida Republican said.
His bill would exempt the honorarium and the value of the Olympic medal itself from any federal taxes.
Congress is currently fighting over how to adjust the broader tax code and whether to let the Bush-era tax cuts expire. But Mr. Rubio said the Olympic winners shouldn’t have to wait until lawmakers finish that job.
“We can all agree that these Olympians who dedicate their lives to athletic excellence should not be punished when they achieve it,” he said.
As of Wednesday afternoon the U.S. had collected 10 gold medals, eight silvers and nine bronzes — though a number of those were in team competitions. So the men’s relay team that won gold in the 4×200 meter freestyle event would together owe nearly $36,000 to Uncle Sam.
All told, U.S. athletes have 57 medals — 28 golds, 18 silvers and 19 bronzes — which comes to a tax bill of nearly $350,000.
Ryan Lochte, the most-decorated American athlete so far, faces a tax bill of $23,357 for his two golds and a silver.
ATR, the group that crunched the numbers, said it’s unlikely any of America’s competition will face the same taxes because the U.S. “is virtually the only developed nation that taxes ‘worldwide’ income earned overseas by its taxpayers.”