Did you really think the IRS would let an American acquire gold without taxing it?
Americans who win bronze will pay a $2 tax on the medal itself. But the bronze comes with a modest prize—$10,000 as an honorarium for devoting your entire life to being the third best athlete on the planet in your chosen discipline. And the IRS will take $3,500 of that, thank you very much.
There are also prizes that accompany each medal: $25,000 for gold, $15,000 for silver, and $10,000 for bronze.
Silver medalists will owe $5,385. You win a gold? Timothy Geithner will be standing there with his hand out for $8,986.
Americans for Tax Reform notes that most other Olympians won’t pay any taxes on their medals because America is one of only a handful of countries which taxes “worldwide” prize income earned overseas.
Sen. Marco Rubio introduced a bill today that would eliminate the federal government’s tax on Olympic medals, saying the tax is just another way the government tries to punish hard work.
“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.