U.S. Olympians Taxed for Medals, Will Owe IRS Thousands

Short and sweet victory

Winning at the 2012 London Olympics has its pitfalls now that the 529 athletes proudly representing the United States will be taxed by the IRS for their hard-earned medals and money. Under U.S. tax law, they must add the value of their Olympic medals and prizes to their taxable income (which they face at a rate of 35 percent). A gold medal worth $650 could cost its recipient $236 in taxes, while a bronze medal worth $5 could result in a $2 tax. The larger amounts are taken out of their cash prizes as a gold medal winner takes home a $25,000 check. So how much is the top prize really worth? Nearly $8,750 in taxes. So far, the United States has achieved 37 awards; almost half are gold. Top takers are the Women's Gymnastics Team, Gabby Douglas (for her individual All-Around win), cyclist Kristin Armstrong, Judo player Kayla Harrison, the Women's Eight Rowing team, skeet shooters Vincent Hancock and Kimberly Rhode, and several swimmers including Michael Phelps and Ryan Lochte. (ATR)

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