So successful Olympians get taxed?

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**Akroma06**

This really surprised me in some ways and in some ways it didn't.

http://www.washingtontimes.com/news/2012/aug/1/rubio-bill-eliminates-federal-tax-olympic-medals/

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 an $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 evening, the U.S. had collected 12 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 4x200 meter freestyle event would together owe nearly $63,000 to Uncle Sam for the four swimmers in the final and the three who took part in preliminary heats.

All told, U.S. athletes have 64 medals — 27 golds, 18 silvers and 19 bronzes — which comes to a tax bill of nearly $350,000.

Swimmer 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.”

Ok so I understand Uncle Sam wanting a cut, but seriously? That is an insane amount of money for being succesful and making the US look good on an international stage. $63,000 for winning a relay? Do other countries do this as well? I'm sorry that a teenager has to pay taxes on winning a race!

**Redbeard**

I read an article about this that stated that other countries, largely, do not tax Olympic winnings.

However, it's income. You get handed $25,000, you pay taxes on it. How is that different than winning in Vegas or the Lottery, or, for that matter, working at 7-11?

Income gets taxed. Olympic prize money is still income.

"That could leave amateur athletes — in many cases still teenagers — facing stiff tax bills when they return to the U.S." - well, yeah, but they also have that large amount of money with which to pay those taxes...

**Manchu**

Income is taxed. Sentimentality doesn't justify carving out special exemptions.

Automatically Appended Next Post:
EDIT: RedBeard rode the Sanity Train in right before me.

**Phanatik**

Redbeard wrote:I read an article about this that stated that other countries, largely, do not tax Olympic winnings.

However, it's income. You get handed $25,000, you pay taxes on it. How is that different than winning in Vegas or the Lottery, or, for that matter, working at 7-11?

Income gets taxed. Olympic prize money is still income..

People get irked about this because the money wasn't earned in the U.S. (for American athletes), so why should the U.S. government get a piece of it?
As of right now, the government doesn't own us.

Regards,

**Jihadin**

But there are exceptions to not being taxed

**azazel the cat**

Redbeard wrote:However, it's income. You get handed $25,000, you pay taxes on it. How is that different than winning in Vegas or the Lottery, or, for that matter, working at 7-11?

Lottery winnings are considered a winfall and are not taxable in Canada... is it different in the USA?

But I completely agree with you: the athletes can easily pay the 8k in taxes out of the 25k they are awarded. You don't have to be a mathlete (see what I did there?) to figure this one out.

Also, it fits nicely with Romney's "Olympic athletes didn't get there on their own" speech, in that the athletes should have to give something back for the use of the government grants and training facilities.

**Manchu**

Phanatik wrote:People get irked about this because the money wasn't earned in the U.S. ...

Er, it sounds like people are irked over this because they have conveniently forgotten that U.S. citizens working or living abroad must still pay taxes on their income.

azazel the cat wrote:is it different in the USA?

Yes. In the U.S., it is income.

**LordofHats**

Whether it was earned in or out of the US is kind of a silly distinction to make. If I invest in Pakistani Marble and make $50,000, sure the money was technically made in Pakistan, but I'm (I assume) as US resident using US services. I still get taxed.

That said, the Olypmics is one thing I could live without being taxed, but then I'll never go to the Olympics so maybe my opinion shouldn't matter

Unless they make laziness an event. I'd get at least a bronze for that one.

**Phanatik**

azazel the cat wrote:
Redbeard wrote:However, it's income. You get handed $25,000, you pay taxes on it. How is that different than winning in Vegas or the Lottery, or, for that matter, working at 7-11?

Lottery winnings are considered a winfall and are not taxable in Canada... is it different in the USA?

But I completely agree with you: the athletes can easily pay the 8k in taxes out of the 25k they are awarded. You don't have to be a mathlete (see what I did there?) to figure this one out..

Part of the problem is that many athletes are still in school, and must comply with being amateur athletes. Receiving cash awards makes one a "professional" and so ineligible to participate in HS/collegiate sports.

Another part is that the medals themselves have an intrinsic value, which must be covered as well, since the U.S. taxes everything but oxygen.

Cheers,

**LordofHats**

You know what the US doesn't tax? Hat wearing.

Part of the problem is that many athletes are still in school, and must comply with being amateur athletes. Receiving cash awards makes one a "professional" and so ineligible to participate in HS/collegiate sports.

Are you arguing that they shouldn't have to pay taxes or that they shouldn't be given a monetary reward for kicking ass?

**Aerethan**

If an American WORKS in a different country, their wages(which wouldn't likely be in USD) should be taxed according to that countries laws, not the US's.

Basically you are telling me that if I move to Japan to teach English, I'll have to pay income tax here in the US on it? After all, my citizenship status remains American.

That is ludicrous. Also, why are we heavily taxing those who's only purpose is to promote a positive national image?

**Manchu**

According to Market Place on NPR, the actual metal of "gold medals" is worth about $650 (obviously, there's not much real gold involved). I can't remember how much silver medals are worth but bronze was about $5.

Also, I'm not sure that winning a cash prize is the same thing as getting paid a salary to do a sport so I'm rather doubtful that successful Olympians are automatically considered "professionals."

Aerethan wrote:Also, why are we heavily taxing those who's only purpose is to promote a positive national image?

I don't think they think of that as their only purpose.

**LordofHats**

Also "professionalism" varies from sport to sport. Such a thing is highly regulated in US football or baseball, but gymnastics is a sport that is pretty much dominated by teenagers. Things like skiing, swimming, fencing, etc are not as hard about the limitations of participation in the sport as some of big money sports.

Blanket statements like that are kind of just, wrong, by their own nature.

**Phanatik**

LordofHats wrote:You know what the US doesn't tax? Hat wearing.

Part of the problem is that many athletes are still in school, and must comply with being amateur athletes. Receiving cash awards makes one a "professional" and so ineligible to participate in HS/collegiate sports.

Are you arguing that they shouldn't have to pay taxes or that they shouldn't be given a monetary reward for kicking ass?

Is that why you are the Lord of Hats?

I don't think they should have to pay taxes for income earned outside of the U.S.
I would say England has a more reasonable claim on the taxes.

If I may engage in Reductio ad absurdum, lets say I travel to Alpha Centauri and mow a little green man's yard for him. Why should the U.S. government get a piece of that simply because I'm a citizen?

Cheers,

**AlmightyWalrus**

How is it "punishing the successful"? They're still better off than they would've been if they didn't win the money, right? Seriously, how is this guy a successful politician?

**Manchu**

U.S. citizens are required to pay taxes on any income, regardless of its source. Whether you agree with it or not, it's certainly not difficult to understand.

AlmightyWalrus wrote:Seriously, how is this guy a successful politician?

You mean how is the guy who relies on ignorance and anger a successful politician?

**Phanatik**

LordofHats wrote:Also "professionalism" varies from sport to sport. Such a thing is highly regulated in US football or baseball, but gymnastics is a sport that is pretty much dominated by teenagers. Things like skiing, swimming, fencing, etc are not as hard about the limitations of participation in the sport as some of big money sports.

Blanket statements like that are kind of just, wrong, by their own nature.

Did I step on your puppy? You seem...belligerent for some reason. Or are you overly fond of taxes?

Why don't you call up the NCAA and ask them if it's okay? I don't think they care either where the money was earned.

Ciao,

**LordofHats**

Exactly. I'm tax exempt

Why should the U.S. government get a piece of that simply because I'm a citizen?

Lets ask Mark Hamil.

EDIT: Drats, it doesn't work

Just go here: http://www.youtube.com/watch?v=G56VgsLfKY4

**d-usa**

Remember, Romney made it clear that athletes benefited from the facilities and help of the american communities that send them to the Olympics, so why shouldn't they pay taxes on their winnings in order to help other athletes have the same chance.

But on a serious note:

It is income. You might talk about them being "amateur athletes" all you want, but they get paid for winning. That is income and should be treated as such.

Of course I would think that any athlete competing at the Olympics shouldn't have the slightest difficulty paying a much smaller share than is actually due. I would not be surprised if the cost for travel, lodging (for qualifiers), equipment, training, lessons, etc totals out to a pretty respectable number. Deduct that from the total winnings and I would be surprised if they still owed taxes.

But of course Marco Rubio is a Republican and is probably just trying to score some cheap political points by being anti-taxes.

**Jihadin**

U.S. citizens are required to pay taxes on any income, regardless of its source. Whether you agree with it or not, it's certainly not difficult to understand.

There are exceptions

**d-usa**

Aerethan wrote:If an American WORKS in a different country, their wages(which wouldn't likely be in USD) should be taxed according to that countries laws, not the US's.

Basically you are telling me that if I move to Japan to teach English, I'll have to pay income tax here in the US on it? After all, my citizenship status remains American.

That is ludicrous. Also, why are we heavily taxing those who's only purpose is to promote a positive national image?

You pay your taxes based on where you live, not where you work.

**AlmightyWalrus**

Manchu wrote:U.S. citizens are required to pay taxes on any income, regardless of its source. Whether you agree with it or not, it's certainly not difficult to understand.

AlmightyWalrus wrote:Seriously, how is this guy a successful politician?
You mean how is the guy who relies on ignorance and anger a successful politician?

This ignorance is on a level I'm not really used to, though. I guess I've overestimated humanity...

**Manchu**

Jihadin wrote:
U.S. citizens are required to pay taxes on any income, regardless of its source. Whether you agree with it or not, it's certainly not difficult to understand.
There are exceptions

Exceptions imply a rule.

**LordofHats**

Phanatik wrote:Did I step on your puppy? You seem...belligerent for some reason.

I don't have a puppy... Not anymore

Or are you overly fond of taxes?

No one is fond of taxes. Some of us just accept the reality of needing to pay them so society doesn't collapse into chaos and don't particularly care that a teenager who just made $25,000 has to pay 1/3 that to the big G. They're flipping teenagers. They just made more in a week than I make in a year.

EDIT: Oh holy snap. How much money did Michael Phelps make in 2008 XD.

**Phanatik**

LordofHats wrote:
Phanatik wrote:Did I step on your puppy? You seem...belligerent for some reason.

I don't have a puppy... Not anymore

Or are you overly fond of taxes?

No one is fond of taxes. Some of us just accept the reality of needing to pay them so society doesn't collapse into chaos and don't particularly care that a teenager who just made $25,000 has to pay 1/3 that to the big G. They're flipping teenagers. They just made more in a week than I make in a year.

EDIT: Oh holy snap. How much money did Michael Phelps make in 2008 XD.

Too bad about the puppy. As a life-long dog owner, I sympathize.

"Some" is right, as about 47% of Americans pay NO income taxes.

Cheers,

**hotsauceman1**

This is money they earned, Its no different from a porffesional athlete over her, make them pay If i have to pay taxes for flipping burgers on a grill they should aswell.

**LordofHats**

Difference is that flipping burgers on a grill probably means that when you file your income taxes you get all your taxes back (though honestly the government could really save us all time and money by finding some way not to tax people its just going to give all the money back to).

**Jihadin**

Exceptions imply a rule.

Additional rules can be made.

I've no issue for the Olympians not to be taxed on the medal and the "stipend" to earn it. Everything else yes I agree. How often are the olympics anyway. Its barely a drop in the bucket..more like a mist.

**hotsauceman1**

Well i actually dont get taxed, I just get paid less for working at a community college. But if it was anywhere else i would. I just feel that it wrong that just because they are at the olympics that makes them untouchable.

**d-usa**

LordofHats wrote:Difference is that flipping burgers on a grill probably means that when you file your income taxes you get all your taxes back (though honestly the government could really save us all time and money by finding some way not to tax people its just going to give all the money back to).

And these athletes can also file taxes and get money back.

They would get a chunk back anyway even if they just filed their standard exemption. Or their parents will get a chunk back if they are under 18.

But like I said, if they deduct all their expenses for travel and training that got them to the Olympics, then I would not be surprised if they get every bit of it back.