You may have never given it a thought as you watched our Olympic team compete in London, but did you know that a gold medal winner receives a $25,000 monetary award in addition to the gold medal, which itself is worth approximately $675, and both are taxed by the IRS? That’s right, just like game show winners, the winning athletes are taxed on their winnings, including the value of the medals themselves.
Silver and bronze medal winners also receive monetary awards: $15,000 for silver and $10,000 for bronze. The medals themselves are valued at $385 and $5, respectively.
Thus, a gold medal winner would have to include $25,675 as income as a result of winning the gold medal. Depending upon the athlete’s other income, winning a gold medal could result in an income tax of as much as $8,986 plus state tax if he or she resides in a state with an income tax.
Marco Rubio, a U.S. senator from Florida, has introduced legislation in Congress to exempt the Olympic monetary awards and medals from taxation. His bill has met a mixed reaction. Some think that professional athletes are already well-paid and should be taxed on their winnings.