Leave it to Grover Norquist to find a tax angle in the 2012 Summer Games. The colorful president of Americans for Tax Reform has released the estimated tax bill that each U.S. Olympian will pay for their medals.
“I’m trying to think of something that doesn’t have tax implications in 21st- century America — and I can’t think of one,” Norquist told us Wednesday. “They just throw softballs to us every day.”
Prizes are considered taxable income; ATR’s calculations are based on the value of the precious metals in each gold, silver and bronze medal. Using Tuesday’s commodity prices, the value of a gold medal (14 oz., 1% gold, 92% silver, 7% copper) was about $675. The silver (14 oz.; 92% silver, 8% copper) was $385 while a bronze medal (13 oz.; 97 % copper, 2% zinc, and a trace of tin) is worth about $5.
Based on these numbers, American athletes will owe approximately $236 for each gold medal, $135 for each silver, and $2 for a bronze, assuming at maximum tax rate of 35 percent.
In addition, many U.S. athletes will earn performance bonuses from the USOC and governing sports bodies, reports the Associate Press, which could boost the tax bill for winning just one medal into the thousands.
Norquist’s number-crunching caught the eye of Congress: On Wednesday, Sen. Marco Rubio introduced the Olympic Tax Elimination Act, retroactively effective Jan. 1, 2012, which exempts U.S. medal winners from paying taxes on “any prize or award” won in any Olympic competition; Rep. Aaron Schock sponsored the House version. “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.
Bill sponsors are trying to get a vote before Thursday’s summer recess; if passed in both houses, it will go to President Obama.
“I think this legislation is going to pass,” predicted Norquist. “You don’t watch small businessmen on NBC for five days in a row. You do watch Olympic athletes.”
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