Olympic athletes who reach the medal podium are awarded an accompanying cash prize of $25,000 for gold, $15,000 for silver and $10,000 for bronze. The IRS taxes not only those cash awards, but the value of the medals themselves. The lobbying group Americans for Tax Reform estimates that at today’s commodity prices, the value of a gold medal is $675, a silver medal is $385, and the bronze medal is just under $5. The group reports that overall, the achievement would subject gold medal winners to about $8,936 in taxes, silver medalists to $5,385 in taxes, and bronze medalists to $3,502 in taxes.
There is currently some discussion as to whether this is appropriate. Senator Mark Rubio of Florida has proposed an Olympic Tax Elimination Act which would remove the tax on Olympic medals and honorariums, stating “We can all agree that these Olympians who dedicate their lives to athletic excellence should not be punished when they achieve it”. Some opponents of the bill call it useless, pointing out that deductible expenses could likely eliminate any taxable income. Other opponents are more philosophical, pointing out that an analogy can be made for any successful business owner who achieves a profit in pursuit of a dream.