Olympic Medalists Pay Tax on Medals
Olympic medal winners must report the value of the medals as income on their US tax returns. Gold medals are worth an estimated $600, silver medals an estimated $300 and bronze medals a mere $4. In addition to the medals, Olympic athletes also receive a cash prize. Gold medal winners receive $25,000, silver medal winners receive $15,000 and bronze medal winners receive $10,000. Uncle Sam wants his share of the winnings.
A good tax accountant can possibly reduce the winner's tax burden. If the athletes consider their Olympic career a business, they can deduct certain business expenses. Possible deductions may include the cost of training, athletic equipment and travel, to name a few. If the athlete considers his or her sport a hobby, he or she may be entitled to deduct expenses as Miscellaneous Itemized Deductions on Schedule A.
Sandra G. Johnson, CPA
August 18, 2016