The 2012 Olympics, held in London, once again united the country in support of our athletes. And as usual, they didn’t let us down—winning over 250 medals and providing hours of entertainment at the same time.
But naturally, where most of us saw encouraging storylines and inspiring feats of athleticism… the IRS saw dollar signs.
As the USA Today explains, US medalists can expect to receive a hefty bill from the IRS:
With the Summer Olympics now over, 127 Americans won a total of 256 medals. These athletes deserve to be celebrated when they return home, but there’s another thing waiting for them that dampens the Olympic spirit: a tax bill.
Currently, Olympians who win medals also receive honorariums from the U.S. Olympic Committee: $25,000 for gold, $15,000 for silver and $10,000 for bronze — all taxable by the IRS.
To address this, Rep. Aaron Schock, R-Ill., and I recently introduced the Olympic Tax Elimination Act to exempt U.S. Olympic medal winners from paying taxes on their hard-earned medals.
Our tax code is riddled with provisions that punish success. Athletes volunteering their time to represent our nation in the Olympics every four years shouldn’t worry about an extra tax bill waiting for them back home.
Whether or not you agree with the author that US Olympic medalists should be exempt from paying taxes, this controversy highlights an important truth: the IRS is nothing if not thorough. They may not move quickly, and their policies may not make much sense to many taxpayers, but you can count on their agents to work relentlessly towards their goal of capturing every bit of revenue that they are owed.
If you’ve ever dealt with an IRS dispute, you know that there is nothing pleasant about the experience. In fact, dealing with the IRS can be one of the most stressful experiences of a taxpayer or business owner’s life. But there’s good news: you don’t have to “go it alone!” At Polston Tax, our team works closely with our clients to resolve their disputes as painlessly as possible. If you’d like to learn more, please get in touch with us today!