Lawmakers seek to exempt Olympic medalists’ payments from taxes
SACRAMENTO — When sprinter Allyson Felix returns home to Southern California with her Olympic gold medal, she may have to share her good fortune with her government.
The $25,000 honorarium that gold medalists receive from the U.S. Olympic Committee is subject to both federal and state taxes, as is the $15,000 for silver medalists and the $10,000 for bronze winners.
Now a bipartisan group of state lawmakers wants to help Felix and more than 30 other California medalists by exempting the honorariums and the value of their medals from state taxes.
The legislators, including Sen. Ron Calderon (D-Montebello) and Assemblyman Allan Mansoor (R-Costa Mesa), are following the lead of members of Congress who have proposed forcing the IRS to stay clear of medal earnings.
“These Olympians are ambassadors for our country and our state, and their sacrifices are often overlooked and taken for granted,” Mansoor said, adding that some “athletes and their families go through severe financial hardships” to finance their training.
Opponents note that the Olympics participants are likely to field lucrative endorsement offers when they return from London.
“I enjoy watching and honoring the Olympic athletes,” said Assemblyman Tom Ammiano (D-San Francisco), “but I think our tax focus should be placed on making sure California’s budget burden is shared fairly. If California wants to go for the gold, we could close tax loopholes now enjoyed by the wealthy.”
California is home to 128 athletes competing in London, nearly 25% of the U.S. Olympic delegation.
Gold medalists who pay the state average of 5.8% income tax could pay $1,450 in state taxes on $25,000, state officials said. The IRS could take up to $8,986, according to the Americans for Tax Reform Foundation.
Some tax experts say athletes could pay less after deducting their training expenses.
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