Are you enjoying the Olympics so far? What was your biggest surprise? Michael Phelps not reaching a gold medal since he was a young lad?
One of my biggest surprises was the Olympic athletes not having to pay taxes!
Surprised? So am I! The athletes in London are getting a nice tax break under an exemption passed for the 2012 games.
According to this article at Forbes:
“You see, the Brits, like the U.S., have a tax system that attempts to tax global income. Under British tax law, the amount of tax due is pro-rated based on the number of events that an athlete competes in inside the country; this is in addition to a 50% tax rate on appearance fees. If, for example, an athlete participates in ten athletics events in 2012 and one of those events is located in the UK, the Brits take the position that they are more or less entitled to 1/10 of that athlete’s worldwide income (some exceptions apply but you get the idea). The tax is imposed even though the athletes may not live in Britain.”
Wow! That is a pretty sweet gig for the British government. It appears that a strong voice against taxes can make a change as the article points out.
“Last year, Jamaican über sprinter Usain Bolt famously declared “I am definitely not going to run [in London]” until the Olympics because of what he viewed as punitive tax laws. His declaration sent the country into a tizzy, worrying that other athletes might make similar proclamations – or not show up for the 2012 Olympics at all.”
With the internet, social media, and the ease of communication, it can prove quite challenging for taxing bodies to keep tabs on all participants. It would be quite a taxing job, no pun intended, to charge taxes on all who do business while visiting the United States.
For the Olympic athletes, I’m happy that they have received a waiver on their tax duty and have the ability to serve their country freely. They should enjoy this time and then after the Olympics are complete they need to visit their local Liberty Tax® office so we can serve them better.
What would be the main tax law in the United States that you would change?
Disclaimer: Every effort has been taken to provide the most accurate and honest analysis of the tax information provided in this blog. Please use your discretion before making any decisions based on the information provided. This blog is not intended to be a substitute for seeking professional tax advice based on your individual needs.