New legislation is pending to exempt Olympic medalists from paying taxes on the prize money they win from the competitions, and Senator Marco Rubio (R-FL) has compared such an exemption to the one available to military servicemen and servicewomen in combat. There is precedent for exempting prize money from taxes, but only if the money is donated to charity.
Nobel Prize winners, for example, can opt to donate their winnings to charity and circumvent the income tax that would apply to the winnings. Some prize winners, such as those who catch a valuable fly ball at the ballpark, could have taken advantage of tax breaks but received bad advice instead. Our country's remarkable athletes who are representing us at the Olympics deserve all of the accolades and prizes they receive, but I'm not sure they qualify for an exemption from income taxes.