Olympic athletes to be taxed on their medals and income

Tuesday, August 14, 2012 by: Fleur Hupston
Tags: Olympic athletes, medals, income tax

(NaturalNews) American athletes could face paying taxes for the gold and silver medals they have won in the Olympic Games. This has outraged many, who feel that Olympians are ambassadors for their country and state and have undergone years of training and sacrifice to reach the level of competitiveness required to compete in the games.

The $25,000 compensation that gold medalists receive from the U.S. Olympic Committee is subject to both federal and state taxes. This applies to the $15,000 reward paid for silver medalists and the $10,000 for bronze winners.

California legislators have proposed forcing the IRS to not impose taxes on medal earnings. According to Assemblyman Allan Mansoor "These Olympians are ambassadors for our country and our state, and their sacrifices are often overlooked and taken for granted.'' He added that "some athletes and their families go through severe financial hardships to finance their training."

Indeed, Olympic athletes train for years to perform at the top level required of them. For many, most of their lives are devoted to attaining the prize of qualifying for the games. Once every four years, that hard work has a chance to pay off with a medal and a cash prize.

Are Olympic medals really solid gold?


Clearly, the real prize is what the gold medal symbolizes. Money-wise, it's not worth as much as it looks.

A gold medal is worth about $800. A silver medal about $500, and the bronze, $3.

However, along with a $800 medal and its symbolism, the US Olympic Committee also awards a cash prize of $25,000 to gold medal winners, $15,000 to silver medal winners and $10,000 for bronze.

So if an American gold medalist wins a $800 medal and $25,000 cash, they must add $25,800 to their total income. And if this moves them into a higher tax bracket, then they'll pay higher taxes on their winnings.

However, while there are many athletes who compete for the love of the sport, many medal-quality athletes have sponsors who pay most of their expenses and would not even feel the tax that would be imposed on them. In addition, a world-class athlete would have many deductible expenses - for training, travel, equipment and so on. Even the lower income, non-professional athletes would owe little or no tax on their Olympic cash bonus. Therefore, many people feel that imposing taxes on athletes in this way is perfectly justified.

Sources:

http://articles.latimes.com
http://latimesblogs.latimes.com
http://chemistry.about.com

About the author:
Fleur Hupston is a professional freelance writer. She is passionate about living as natural a life as possible and reducing damage to the environment wherever possible. She spends a lot of time researching and writing about alternate medicines and healthy, green living, and manages to find the time to home-school her two daughters.