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Taxes in 2014 for U.S. Olympic Medalist

Olympic hopefuls enjoy pride in their athletic abilities and country when they train and compete. The medals they win almost take second place after the years of hard work and determination it takes to win them. The theatrics, media coverage, sports casting, Olympic village and competition among the world’s best are, alone, a unique payoff. But there is an actual monetary value on those medals, and you guessed it - Uncle Sam gets a cut.

U.S. Olympic Medal Winners

So what do U.S. Olympic medal winners get for their top athletic achievements? The U.S. Olympic committee, the group that pays winning athletes, provides $25,000 for gold medals, $15,000 for silver medals and $10,000 for bronze medals. That’s not very much when you consider what some other countries pay their winning athletes, but it's better than nothing, which is what the U.K., Norway, Croatia and Sweden pay their medal winners.

Taxes in 2014 for Olympic Medalists

When U.S. Olympic athletes win medals, they are taxed on their earnings by up to 39 percent. That’s a lot of athletic ability and effort drained by income taxes in 2014 alone. There is some debate and legislation effort against taxing Olympian winners, as many feel they shouldn’t be taxed when they win medals for their country among the world’s top athletes. Many other countries don’t tax their Olympic athletes. In February, 2014, Texas Representative Blake Farenthold reintroduced the Tax Exemptions for American Medalists Act to exempt U.S. Olympic athletes from being taxed on medals and prizes won in Olympic competition.

Countries That Pay the Most

Countries paying the most for Olympic gold medals include Singapore, Azerbaijan, Russia, France, Switzerland, the Czech Republic, Italy, Belarus, Latvia, Estonia and Kazakhstan. Top pay is at $800,000 in Singapore, while Malaysia provides $600,000, Azerbaijan pays $500,000, Kzazkhastan gives $250,000, Latvia pays $192,000 and Italy provides $191,000. Not all of these countries sent athletes to the 2014 Olympics, however.

The Real Olympic Gold

While being an Olympic gold medal winner is a unique honor and earns a place in history, the real Olympic gold is in endorsements and advertising deals. While a U.S. Olympic gold medal winner loses almost $10,000 of their payment to taxes, Olympic sponsors start signing athletes to represent their brands long before the games begin - betting on potential medalists and taking advantage of all of the pre-Olympics hype.

Endorsement and advertising paychecks are pretty big, making the athlete hundreds of thousands to millions of dollars. For the 2014 Olympics, skiers and skaters were the big earners with high taxes in 2014. Alpine skier Ted Ligety was paid almost $20 million by Dayquil and Nyquil. Skier Billy Demong earned almost $10 million from Citibank and Visa. Ski jumper Sarah Hendrickson got almost $5 million from Visa, and Kashi paid cross country skier Kikkan Randall $2.5 million. Other big endorsement earners included ice hockey athlete Julie Chu promoting Citibank, Bounty and BP, speed skater Allyson Dudek promoting AT&T and figure skater Ashley Wagner for Cover Girl.

Former Olympians in different sports earned even more than 2014’s talented Olympic athletes. Basketball and tennis have had the highest paid athletes as recently as 2012, with tennis player Roger Federer earning $54.3 million in prize money and appearances for companies including Nike, Rolex and Mercedes Benz. He is one of seven tennis players who are some of the highest-paid Olympians in history. Basketball's LeBron James and Kobe Bryant earn millions from Nike, McDonald’s, Coca-Cola and State Farm and Olympian track star Usain Bolt earns millions from Puma, Gatorade, Nissan and Visa. The hard work and training really pays off for Olympian athletes, but it also pays the government.

For more information on taxes in 2014, download our 2014 Tax & Limits Quick-Help, or contact us today.

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