The U.S. is one of the only countries that doesn’t provide government funding to its Olympians.
America’s Olympic medalists must pay state and federal taxes on the prize money they get for winning. The U.S. Olympic Committee awards $25,000 for gold medals, $15,000 for silver and $10,000 for bronze.
Olympians also have to pay tax on the value of the medals themselves.
Gold and silver medals are made mostly of silver, while bronze medals are composed of mostly copper. Rio’s medals are among the largest and heaviest ever and contain about 500 grams of either silver or copper.
The value of a gold medal is about $564, silver is worth about $305 and bronze is worth a negligible amount, so it’s not taxed.
Taxes are yet another burden for Olympians, the majority of whom are already struggling to get by.
A handful of lucky athletes land lucrative endorsement deals. But most of them rely on small stipends from the USOC, support from local businesses or supplemental income from a day job.
Olympic medal winners may catch a break though.
Proposed federal legislation would make “the value of any medal or prize money” awarded during the Olympics or Paralympics exempt from income taxes.
The bill was passed by the Senate last month and is being considered by the House. It would apply to earnings from January 1, 2016 to January 1, 2021.
California is reviewing a similar proposal.
Dr. Steven Gill, a tax professor at San Diego State University, isn’t convinced an exception for Olympians and Paralympians would change anything.
For one thing, the USOC might be tempted to reduce Olympians’ prize money, Gill said.
He added that even tax free, American athletes get a fraction of the financial support that athletes in other countries get.
“When I think about why these prizes exist, it’s to compete with state-supported athletes from other countries,” he said. “Cutting taxes isn’t going to fix the fact that these athletes don’t get paid enough, it’s a short-term fix.”
Gill also noted that other individuals who win prestigious awards are taxed on their winnings. Such is the case with Nobel prize winners although they receive more prize money, around $1 million.
There’s a reason why so many American athletes turn to sites like GoFundMe for financial help: Unlike other countries, the United States doesn’t provide government funding to its Olympic committee. This agreement, set in 1978 as part of the Ted Stevens Olympic and Amateur Sports Act, allowed the US Olympic Committee to hold exclusive control over the representation of American athletes and terms associated with the Olympics. As a result, the USOC is responsible for fundraising the amount of money needed to send athletes to the competition, maintain training facilities, secure sponsorships, and pay its staff.
“Our nation stands apart from others because our Olympic and Paralympic teams are not just cheered by an enthusiastic national fan base, but also funded by one,” the US Olympic Foundation, a nonprofit that fundraises for the USOC, notes on its website.
Contrast the United States with the United Kingdom, for instance, which pours about £543 million (about $709 million) from the Department for Culture, Media, and Sport and the National Lottery into UK Sport, a sports agency that manages funding and partnerships for the country’s Olympic athletes. Olympic athletes there are eligible to receive anywhere from £15,000 to £28,000 a year (almost $20,000 to some $37,000) based on their performance.
That’s in addition to other services and training support UK athletes receive. In Canada, the government invests about CA$200 million ($153 million) into the Olympics annually, and senior athletes receive CA$1,500 monthly stipends. Some athletes are given extra funding if they have won medals in the past.
The USOC does dole out millions of dollars for its athletes, as well as cover basic airfare, lodging, and food during the games. It says it spent $73 million in direct funding for athletes and another $81 million for programming in 2013. Sponsorships from private companies such as Deloitte and Chobani also provide funding, but these only cover a certain number of teams and athletes.
“Sports that don’t draw a lot of revenue get a smaller share of the funding that’s available, so it’s up to the [individual sport] federation and how many athletes they support before making the team,” said Mark Dyreson, a professor of kinesiology and history at Penn State University. “In smaller sports, it’s just a handful of athletes that get support.”
Though there’s no comprehensive data on how much American Olympic athletes are paid, an investigation by the Washington Post found that of all the funds involved in the USOC, athletes made the least amount of money.
A member of the track and field team made an average income of $17,000, while athletes on the swimming team could make only up to $42,000 in stipends......................
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