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I have a better question, why are winning Olympians given anying beyond a medal and fame anyways?

It really seems that should be enough, let them earn money later through cereal and deoderant commercials.

I don't remember (and never really learned) all of the intricacies but to the extent that corporation is a resident of the United States, its income is taxable by the United States.

Yeah, but that doesn't stop them from hiding it from the government as much as they can.

Corporations have a lot of incentives to commit criminal acts. The past two decades alone have had almost constant corporate corruption scandals, tax evasion scandals, corporate stupidity scandals, theft on a grand scale, etc. Year after year after year, more and more scandals.

Shadowseer_Kim wrote:I have a better question, why are winning Olympians given anying beyond a medal and fame anyways?

We believe that money is the natural right of a successful person, which in turn derives from the more fundamental belief that a gift of money is the universal means to encourage behavior that we like.


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Melissia wrote:Yeah, but that doesn't stop them from hiding it from the government as much as they can.

Yes, corporate culture has demonstrated consistently that it has only one goal: to make a profit for the ownership. This attitude has itself been enshrined into our law.

Manchu wrote:

Melissia wrote:Right, this is income, but when a company hides its money in the Cayman Islands, it's not income to be taxed.

I believe what actually happens is that the income earned by the corporation is taxed by the U.S. at the time that it is earned. What is left is then hidden away in the Cayman islands, where the United States does not have the jurisdiction to tax how wealth is invested and stored.

This is indeed how tax havens work. Regrettably, there is simply no good way to resolve the situation, as forbidding one's citizens from doing what they wish with their assets would be regarded as remarkably illiberal, and, short of the use or threat of force, neither your government nor mine can forbid another sovereign power from structuring its tax system to attract offshore investors.

Well, I suppose we could in most instances. But we certainly don't want to.

Manchu wrote:Yes, corporate culture has demonstrated consistently that it has only one goal: to make a profit for the ownership. This attitude has itself been enshrined into our law.

Right, which is why we currently have effectively no punishment for corporate corruption even though we do have punishment for lesser crimes.

This is no where near the insanity of the US tax code.

damn baseball references, I never remember those details. but a guy catches a baseball that broke some record about 3 or 4 years ago now.

This isn't the story I'm thinking of, but this guy owes $14,000 for catching a ball.

http://www.nytimes.com/2011/07/12/nyregion/fan-may-owe-taxes-for-claiming-jeters-3000th-hit.html

Here it is, berry bonds, now how could I forget him

http://nbcsports.msnbc.com/id/20186528/
"That would instantly put Murphy, a college student from Queens, in the highest tax bracket for individual income, where he would face a tax rate of about 35 percent, or about $210,000 on a $600,000 ball.

Even if he does not sell the ball, Murphy would still owe the taxes based on a reasonable estimate of its value, according to Barrie. Capital gains taxes also could be levied in the future as the ball gains value, he said."

I'm not sure why this is so polarizing... people weighed in from the very first posts with very strong opinions.

I don't think it's really a big deal. This is a drop in the bucket based on how many medals are won each year. Making them tax exempt would be a nice gesture.

Although I'm sure it being brought up was political, the actual issue is rather neutral, and pretty much irrelevant on a country scale.

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.


"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...

Maybe Romney can have his accountant help them set up a tax shelter in the Caymans?

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


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EDIT: RedBeard rode the Sanity Train in right before me.

So Rubio wants to strike a blow against the complex tax code, by making it more complex?

By his logic income from winning the World Series or Super Bowl or pro poker should not be taxed either.

Or for that matter investing.

But wait the republicans also oppose taxing inheritance.

So no taxes if you work, no taxes if you're just lucky either.

We tax income, not 'success' because income is measurable and people with higher incomes can pay more without starving.





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RiTides wrote:I'm not sure why this is so polarizing... people weighed in from the very first posts with very strong opinions.

I don't think it's really a big deal. This is a drop in the bucket based on how many medals are won each year. Making them tax exempt would be a nice gesture.

Although I'm sure it being brought up was political, the actual issue is rather neutral, and pretty much irrelevant on a country scale.

Yeah but law should not be made on the basis of nice gestures. There's a larger agenda here of rebranding progressive income taxes as 'taxing success in the hope of lowering the rich's taxes and raising everyone else's.

Olympic athletes are being uses as pawns but politicians.

Phanatik wrote:
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.

Not quite.

Note also that 2.a.(1) is a farce given how scholarships are administered.

Just as a side note to an earlier post:

During the year you are not paying taxes out of your paycheck. Your employer is withholding money that it sends to the IRS come tax time the following year. The IRS doesn't see a dime of your paycheck until the following year when all of your income is reported.

The exception to this is a levy, or if you have past tax debt that is paid from your check, but the latter is voluntary, the levy is not and is a collection action.

One thing that is interesting: look up a trust fund recovery penelty, this is a penelty from the IRS that is placed against a corporation or business, as well as all within the business who had a hand in using the money withheld from your check to be used to pay tax on your income at the end of the year for things other than taxes.

By the way as much as i hate to admit it, I work collections for the IRS, so I see this every day, and people always say "I pay taxes out of my check already!" To which I reply: "No, you have taxes withheld so you don't have to pay taxes next year."

And don't hate me because I work for the IRS, it pays....

Iron how does it work for us in the combat zone. Just wondering cause that would pretty much debunk the 47% thats being quoted (if we were added in on that)

I want all the taxes I payed whilst based out of Germany back then.

Taxing the actual metals seems a little silly...

Jihadin wrote:Iron how does it work for us in the combat zone. Just wondering cause that would pretty much debunk the 47% thats being quoted (if we were added in on that)

It's already been debunked. Go back and read pretre's posts. Everyone who doesn't owe taxes at the end of the year is included in that 47% number; including the guys in combat zones.

Manchu - no I agree with you there that we give money to people to encourage that behavior, work for instance, welfare often sadly.

But as I was saying there is plenty of incentive to go and do well at the Olympics besides a cash reward, so for this reason it seems rather unnessicary.

They're not doing it for the money. Glory is all. Give me a gold medal, and I'm not going to much give a damn whether it comes with $25k or $16k on the side. That's a bonus.

It's like selling painted miniatures. In either case, when you consider the hours (thousands upon thousands for the Olympians) invested, if you calculate the reward in terms of cash, either number becomes a pittance. The cash isn't the reason to do it, and it isn't the reason they do it.

Phanatik wrote: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?

Uh, for an Olympic athlete it's a full time, 365 days a year profession. They train and prepare all year around, and do most of this in government provided/subsidised facilities. That's why America has done so well at the game for so long - because there's a load of support for elite athletes that poorer countries can't match.

And all that time they're using the roads every other American uses. Relying on the same police services, and all the rest. That part of their job involved being overseas for 2 weeks doesn't mean they don't benefit from society.


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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.

Citizenship doesn't define where you get taxed, residency does. Residency is defined as a person taking up permanent residence in a place.

So if you moved to Japan to teach for three months, you'd be taxed on the money earned there when you went home (though you'd receive a tax credit for any tax paid while in Japan). On the other hand, if you moved to Japan without any deadline for returning, and took out a lease on a place, started filling it with furniture, and basically went about acting like Japan was where you lived now, then the US government wouldn't have any claim on that money.

The athletes went to UK for a fortnight, competed and went home. So no, they really don't qualify as residents of the UK during the period in which the medal was one.

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

Uh, you're flat out giving them money for winning a medal. Some of which is taken back in tax. How is a government penalty when they're paying more money

Also, the idea that athletes are doing it just for their country is silly. They're doing it because they love their sport, love to compete, and because success can net a lot of benefits in later life. Maybe patriotism comes a distant fourth for some of them. I mean, do you think Phelps was in the pool completing a strenuous training routine, and thought 'oh man I'd love to stop swimming, I'm so tired... but America needs me!' ?


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Phanatik wrote: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.

So what you're saying is that you don't know anything about how tax law works, but you want to have an opinion on it anyway.

Go read about residency. Learn, and use that to develop an informed opinion of the subject.


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Manchu wrote:Romney has a great point about Olympians and Obama has a great point about businesses. None of us can do it alone. Why would you even want to? What an ugly, depressing fantasy to have.

Well said.

mattyrm wrote:Considering they always go on to earn a couple million bucks once they get a gold medal, is it a big deal they pay a few grand on the actual medal?

Taxes should be fair across the board. If the athletes make money (and many are indeed making gobs of money) they should pay taxes at the same rate as any other person making that kind of dough. We'd scream is a multimillion dollar basketball player wasn't paying any taxes.

sebster wrote:

Phanatik wrote: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?

Uh, for an Olympic athlete it's a full time, 365 days a year profession. They train and prepare all year around, and do most of this in government provided/subsidised facilities.

Our government doesn't sponsor our Olympic athletes.

Melissia wrote:And when a corporation, who is considered a separate legal entity, earns an income, it's not supposed to be taxed either, if you listen to Republicans.

Crazy lefties that want to continuously raise the taxes received from corporations don't seem to understand (or just don't care, as the left never met a tax it didn't like) that the CUSTOMERS of those corporations pay the taxes thru higher prices.

Phanatik wrote:

Melissia wrote:And when a corporation, who is considered a separate legal entity, earns an income, it's not supposed to be taxed either, if you listen to Republicans.

Crazy lefties that want to continuously raise the taxes received from corporations don't seem to understand (or just don't care, as the left never met a tax it didn't like) that the CUSTOMERS of those corporations pay the taxes thru higher prices.

Only if that corporation doesn't have competition.

Not that most right-wing politicians promote competition to begin with. As if either side is really dedicated to that.

Bromsy wrote:I want all the taxes I payed whilst based out of Germany back then.

Rather a foolish thing to ask, since the alternative would have been to have been taxed by the German government at their domestic rate, which is notably higher than that of the US, despite the fact that, unless you planned to retire to Germany, you would never have benefited from their generous pensions, free (or heavily-subsidised) universities, free healthcare, etc.

The Mad Tanker wrote:Taxing the actual metals seems a little silly...

Unfortunately, the system has to work this way, since otherwise it would create an easily-exploited loophole for tax evasion by accepting payment in medals. The only way around it would be the passing of a law specifically to exempt Olympic medals won directly in competition. (It would need to be very specific and tightly-worded, of course, otherwise everybody would be able to trade precious metals tax-free simply by casting them into the shape of an Olympic medal.) Yes, tax evasion does get this petty.

sirlynchmob wrote:damn baseball references, I never remember those details. but a guy catches a baseball that broke some record about 3 or 4 years ago now.

This isn't the story I'm thinking of, but this guy owes $14,000 for catching a ball.

http://www.nytimes.com/2011/07/12/nyregion/fan-may-owe-taxes-for-claiming-jeters-3000th-hit.html

Same problem here, 'gifts' beyond a negligible level have to be taxed, or we'd all avoid taxes by paying/accepting payment in-kind. In this instance, however, one would think that it should have been within the IRS's power to exercise discretion, given the uniqueness of the event.

Jihadin wrote:Iron how does it work for us in the combat zone. Just wondering cause that would pretty much debunk the 47% thats being quoted (if we were added in on that)

Military members earning income in a combat zone earn that income tax free. That is why people in the Navy will try to re-enlist in a combat zone, so they get their re-enlistment bonus tax free (a freind of mine who was a nuke on our boat got a 105k$ tax free check while I was on the boat). The IRS also will suspend all collection action, and shelve a military persons account if they are in a combat zone if they have a balance owed from previous years, until they get back. Only thing is I am fairly certain "combat zone" is a loose deffinition of the term, because it covers a pretty broad area around any area where the US has a combat/peacekeeping role.

Don't be silly. Olympians get sent to Aperture Science for testing.

Ah the good old right wing.

Nothing should be taxed, government should stay out of everything.

Except religion. Government should legislate the poop out of religion and make Christianity law!

Phanatik wrote:
Crazy lefties that want to continuously raise the taxes received from corporations don't seem to understand (or just don't care, as the left never met a tax it didn't like) that the CUSTOMERS of those corporations pay the taxes thru higher prices.

I don't see a problem.