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    Rubio proposes Olympic medal tax break

    Rubio proposes Olympic medal tax break

    It’s been met with praise, and skepticism. (Via Yahoo!News)

    “Athletes representing our nation overseas in the Olympics shouldn’t have to worry about an extra tax bill waiting for them back home,” Rubio said in a statement. “We can all agree that these Olympians who dedicate their lives to athletic excellence should not be punished when they achieve it.”

    Americans for Tax Reform, a group founded by conservative activist Grover Norquist, estimated that Olympic medalists face a tax burden of as much as $8,986 when they return from the competition.

    To me, the idea sounds great. Why should we punish our athletes with a tax burden because they represented us too well? However, Conor Friedersdorf of The Atlantic sees the proposed tax break to be out of step with Rubio’s general policy of overall tax reform.

    But treating Olympic winnings as if they are singular and morally superior to other income, and even other prize income, cannot be justified, and least of all by someone who advocates tax code simplicity and objects to government picking winners and losers. Simplifying the American tax code is tremendously important. Rubio’s proposal tries to trade on that importance, but it is no more than a cheap stunt, and the man proposing it seems not to realize that the impulse behind his bill is the very one he needs to defeat if he’s serious about tax code reform.

    It’s an interesting point. I wouldn’t go so far as to say Rubio engaged in a “cheap stunt.” Rather, it seems a genuine attempt to do a nice thing for (mostly young) Olympians who are helping promote America’s global prestige. I also don’t think that adding a line or two to the tax code to accommodate Olympic athletes would do much to convolute it.

    However, over the last quarter century, doing well and representing your country on the global stage hasn’t necessarily translated to immunity from taxes. Even those who win the Nobel Prize learn that it comes with a hefty burden from Uncle Sam.

    The fact that IRS gets a piece of prizes can be a rude awakening for Nobel winners.  Martin Chalfie won a Nobel in Chemistry but lamented the tax bill.  See Life After Winning a Nobel Prize.  Before 1986, most prizes were tax-free. Now prizes and awards are taxable.

    And of course, winners of Obama’s dinner raffles also must pay the tax man.

    So what do you think? Do Olympic athletes trump Nobel Prize and Obama Dinner Raffle winners?

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    Comments


    If Rubio’s suggestion was a “cheap stunt”, then so is every other knee-jerk legislation or regulation of the past century. It is the fatal disease of nearly all legislators – even if it will save one live, or we must do something…

    Conner is right, even if his motivation is to score demerit marks against Sen Rubio. Further, Friedersdorf criticism, were he honest and expanded the logic, would fall far more heavily upon the left.

    Rubio’s folly is allowing his heart to suggest policy without thinking through the implications. Sure it would be nice to prevent those nice little gals of Gold Medal winning US Gymnastics to keep all their winnings. But, if you do that, then all the members of the US Basketball, Volleyball, Tennis, Swimming, Track and Field, etc. would also have to keep their winnings tax free. As you can see, most of the later are professional athletes, earning their living from their athletic talents. They earn their living from competing in the games, races, and judged matches that they are ostensibly only representing their country. Yet it may be a higher level of prestige, but it is still just their job. (Superbowl, Wimbledon, World Cup, Tour de France anyone?)

    No Professor, two lines in the tax code would not adequately delineate between the “amateur” and “pro”. In fact, as many have already pointed out, it is this kind of thinking that has created the IRS monster that we now live under. Rubio should quietly admit he was speaking from impulse, and not thinking rationally, and walk away from his suggestion.


     
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    memomachine | August 3, 2012 at 12:53 am

    Personally I am in favor of exempting the medals and cash awards given to Olympic champions.

    While there are professional athletes in the USA Olympic squad the vast majority are unlikely to have much of a paying career outside their sport. Some are true professionals such as the USA Basketball team. Others have large endorsement payoffs such as Phelps. Some have smaller endorsement opportunities and payoffs such as the beach volleyball players.

    But most do not.

    Instead they have to have jobs, rely on friends and family and devote an enormous amount of time, money and sweat to their respective sport. Seriously how much money is there in judo? Or archery? Or Bobsled? Just how much does it cost to be an Olympian at all?

    Comparing Olympic athletes to Nobel Prize winners isn’t a precise 1 to 1 match up. Nobel Prize winners by and large are fully employed in their field and are often leaders in those fields with good incomes from governments, universities and corporations.

    American Olympic athletes get no funding support at all from the US government, must rely on private donations or financing and are out of pocket for all expenses. And if you don’t get an endorsement deal or play in a professional sport then you have to have a job that will not only let you spend enormous amounts of time training but also take large periods of time off to attend competitions.

    What exactly are we talking about in terms of a payday here? $25,000 for a gold medal? That you only have a shot at getting once every 4 years? And that is if you get a gold medal. How many American Olympians have fought and sweated for their entire lives and never gotten a single medal?

    In some ways I agree with the posters who feel that there should be consistency. I agree that the principle should be to reduce the tax laws not add to them. But take a few moments and consider what we’re discussing here.


     
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    Voyager | August 3, 2012 at 8:35 am

    Why not just go back to the pre-86 taxing policy on prizes?


     
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    Tortuga | August 4, 2012 at 7:39 am

    1. I didn’t know Olympic metal winners received a cash payment, but what the heck, I didn’t know Dingy Harry Reid was in the closet, either.2. Am I the only one that is having doubts about this Rubio senator lately? He has a former Goldman Sachs employee for a chief of staff and now this “from the hip” law submitted for what, maybe 400 elite taxpayers. Isn’t that sort of cherry picking in the tax code one of the things we conservatives are supposed to be against?
    3. How about a “cherry picking” law that TAXES the Solyndra bonuses, or pensions paid with tax dollars over the median working American pension, or on Defense contractor pension payments with Tax dollars or GSA non-earned bonuses or on DOJ, AIG, DOEd, DOEnergy, UN theft, etc. etc.
    Is Rubio becoming or has he really been a RINO all along? Don’t know, but I will be paying closer attention to his actions.
    God Bless America, RICO all banksters, their ho politicians and IMPEACH the liar, Eric Holder.


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