The IRS Takes Gold in Rio
America’s Olympic Medalists in Rio will return to an unpleasant reality: a tax bill. Each medalist will be taxed on their award from the U.S. Olympic Committee and the monetary value of the medal itself. The U.S. Olympic Committee awards cash prizes to medal winners in the following amounts: $25,000 for gold, $15,000 for silver, and $10,000 for bronze. According the IRS, all cash prizes and awards are taxed as income earned abroad. The awards are treated the same as a lottery payout or casino winnings. Further, the medal’s value itself is taxed based on the scrap value of the metals used to compose the medal. The monetary value of a gold medal is approximately $550, silver is approximately $300, and the bronze, which is composed mostly of copper, has a negligible value.
Relief of the tax burden may be in sight for Olympic and Paralympic medalist. New York Senator Charles Schumer is fighting to pass a bill that would exempt Olympic and Paralympic medalists from paying taxes on their medals and cash awards. The U.S. Senate has already passed the bill that Schumer co-sponsored. The bill is known as the United States Appreciation for Olympians and Paralympians Act. The act would block the IRS from taxing Olympic and Paralympic medalists. This bill is currently pending in the U.S. House of Representatives. The bill would apply to earnings from January 1, 2016 through January 1, 2021.