The Biggest Loser of The Rio Olympics?
9 August 2016 by Amy Burton
At the Rio Olympics and all previous Olympic Games, medal winning USA competitors have to report as income the cash prizes that are presented to them by the US Olympic Committee and pay the associated income tax. A Gold medallist receives $25,000 in prize winnings from the Committee, $15,000 for a Silver medal and $10,000 for a Bronze. The value of the medals themselves are also classed as ‘taxable compensation’ earned abroad.
The US Internal Revenue Service (IRS) certainly has an interest in its competitors’ performance, but sadly not for the same reason as patriots of the nation.
Over the last few Games there have been attempts by lawmakers in both the House of Representatives and the Senate to introduce a tax-break for the medallists, but unfortunately they did not succeed in making these attempts any more than just that.
However in order to support their athletes and competitors, the Senate has this year unanimously passed the ‘United State Appreciation for Olympians and Paralympians Act’. Under this bill, the medallists would no longer have to sacrifice any of their winnings, which would be another victory for them and this time one won on home turf.
Senator John Thurne when introducing the bill stated that it sent “the right message to Team USA, both present and future” and he recognised that the Olympic hopefuls deserved to be rewarded for “years of relentless training and hard work, a significant financial commitment and an immeasurable amount of sacrifice”.
Now it is the turn of the House of Representatives to pass the bill and make it law. The House however is in recess until 6 September, so when considering the bill it is thought that they will make this retrospective in order to provide relief to the Rio medallists.
Representative Elise Stefanik has gone on record in support of the bill and will be “co-sponsoring legislation that will exempt our athletes from burdensome tax penalties they face when they win Olympic medals. After all of the sacrifice our athletes make for years to represent us on the world stage, we should not punish them for being victorious.”
Undoubtedly the IRS are far from happy, as dependent upon the success of the US competitors, this loss in their income stream could be rather significant. Rumour mills are already in overdrive with talk of the bill being challenged in the House. With the USA having 19 medals under their belt already in Rio, it is hoped that the authorities will put the pride of the nation above their concerns of lost revenue.
Whichever way the story unfolds, the IRS will sadly still have the last laugh as whilst this is one possible hurdle cleared, it remains the case that the tens, and possibly hundreds, of thousands of dollars that medallists receive in respect of product endorsements and Olympic corporate sponsorship will still be taxable.
RT @LawSocietyFAS: Make sure those you love the most are always protected, no matter what happens. Talk to a solicitor about including your…3 hours
The importance of having a Home Buyers Report or RICS Building Survey carried out is crucial to every purchase tran… https://t.co/0TBtNXGvC61 day