Olympic tax break?
Reps. Robert Dold (R-IL) and Blake Farenthold (R-TX) are introducing legislation known as the U.S. Appreciation for Olympians and Paralympians Act, intended to eliminate the tax levied by the IRS on medals awarded to Team USA athletes during the Olympic or Paralympic Games.
In a statement, Rep. Dold said, “Our Olympic and Paralympic athletes make numerous personal sacrifices while training to represent the United States on the global stage.... But when they return home with a medal for Team USA, the IRS forces the athletes to pay a penalty for their success. Our bill will prevent the IRS from penalizing Team USA's champions and ensure that our athletes can remain focused on fulfilling their Olympic dreams without fear of the tax consequences."
Beginning with the 2016 Olympic and Paralympic Games in Rio de Janeiro, Brazil, the U.S. Appreciation for Olympians and Paralympians Act would exempt the value of medals won and other prizes awarded by the United States Olympic Committee from an athlete’s taxable income. The bill would have a negligible effect on federal revenue and would not affect taxes on endorsement or sponsorship income earned by athletes.
A Senate companion bill, which is co-sponsored by Sens. John Thune (R-SD) and Chuck Schumer (D-NY), passed earlier this year. Ways and Means Committee Chairman Kevin Brady (R-TX) has committed to moving the bill through committee when Congress returns in September.
While the bills enjoy wide bipartisan support, including from anti-tax activists like Grover Norquist, there are some opponents who claim this is another example of the government using the tax code to pick winners and losers.