For Olympic athletes, a gold medal at this year’s summer games in Brazil could be the achievement of a lifetime. But that first-place finish could cost them some serious cash in taxes once they arrive home.
America’s Olympic medalists receive $25,000 for gold, $15,000 for second-place silver and $10,000 for third-place bronze — money paid out by the U.S. Olympic Committee that is taxed by the Internal Revenue Service. Olympians in New York are also taxed by the state. In addition, the value of the gold and silver medals is also taxed.
Legislation at both the state and federal levels would do away with this “victory tax,” as Sen. Charles Schumer describes it.
New York’s senior Democratic senator has proposed a bill, co-sponsored by South Dakota Republican Sen. John Thune, that would make all Olympic medals tax-exempt. The Senate passed the bill in July and Schumer is calling on the House of Representatives to do the same.
If the law is enacted, U.S. Olympians and Paralympians would be allowed to exempt the value of medals from their taxable income as well as the cash prizes awarded by the national Olympic committee. The bill would have a negligible effect on federal revenue and would not affect taxes on any potential endorsement or sponsorship income earned by Olympic athletes, Schumer said.
Schumer, who played high school varsity basketball in Brooklyn, in a press release said most countries do more to subsidize their athletes than the U.S., so the “very least the U.S. can do” is save athletes from a tax hit.
At the state level, Assembly-woman Nicole Malliotakis, a Republican from Staten Island, told reporters this week she will introduce legislation in 2017 to exempt Olympic prize money from state taxes as well.
“These Olympians bring much pride to our state and nation and they should be celebrated not taxed for their achievements,” . “Most of them do not get endorsement deals but instead survive on small stipends and sacrifice much to compete in the games.”
New York sent 30 athletes to the Summer Olympic Games in Rio de Janeiro, the fifth most behind California (124 athletes), Florida (39 athletes), Texas (33 athletes) and Pennsylvania (31 athletes), according to a . Seven Olympians hail from Connecticut cities and towns, including four from Bridgeport, New Canaan, Norwalk and Stamford in Fairfield County.
Five New Yorkers had won medals in Rio as of Aug. 15, according to the press release from Malliotakis. Meghan Musnicki from Naples and Emily Regan from Buffalo both won gold in rowing.