Will the tax man make an exception for U.S. Olympians who won gold, silver or bronze medals for their country?
If the White House has its way, then maybe so.
After a firestorm of controversy following a report that revealed the income taxes on medal winners’ earnings (up to $8,986 for gold medal winners), Florida Senator Marco Rubio proposed the Olympic Tax Elimination Act last week. Olympians who rank in the top three of their event are also awarded cash prizes, which are subject to tax, which could get pretty pricey for athletes like, say, Michael Phelps. The proposed plan would eliminate the tax burden on U.S. medal winners.
“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,” Rubio said.
Now the senator has at least one heavy-hitting supporter: President Barack Obama. According to the Atlantic Wire, the president said he would throw his support behind Rubio’s proposal. However, as noted by the Atlantic Wire, the idea has not come without criticism. Bloomberg’s Josh Barro pointed out a few discrepancies in Rubio’s position:
Rubio said just last week that America needs “real tax reform that simplifies the tax code.” That’s true. So why is he proposing to introduce a stupid new complication into the tax code? Tax reform means removing deductions from the tax code, not adding them.
What do you think? Should Olympians be exempt from taxes on their medals and cash prizes?