Senator Marco Rubio, R-Fla., has introduced legislation to exempt U.S. Olympic medal winners from paying taxes on the medals that they win.

Olympians who win medals also receive an honorarium in the form of cash payments of $25,000 for gold, $15,000 for silver and $10,000 for bronze, with the Internal Revenue Service collecting taxes on these amounts.

Rubio introduced the bill in response to a report from Grover Norquist's lobbying group Americans for Tax Reform estimating that the medals would subject gold medal winners to about $8,936 in taxes, silver medalists to $5,385 in taxes, and bronze medalists to $3,502 in taxes. The research found that in addition to the cash payments to Olympians, at today's commodity prices, the value of a gold medal is about $675, a silver medal is worth about $385 while a bronze medal is worth under $5.

"Our Tax Code is a complicated and burdensome mess that too often punishes success, and the tax imposed on Olympic medal winners is a classic example of this madness," Rubio said in a statement. "Athletes representing our nation overseas in the Olympics shouldn't have to worry about an extra tax bill waiting for them back home. We need a fundamental overhaul of our Tax Code, but we shouldn't wait any time we have a chance to aggressively fix ridiculous tax laws like this tax on Olympians' medals and prize money. We can all agree that these Olympians who dedicate their lives to athletic excellence should not be punished when they achieve it."

The Olympic Tax Elimination Act would amend the Tax Code to eliminate the tax on Olympic medals and prize money won by United States athletes.  If enacted into law, the gross income of Olympic athletes "shall not include the value of any prize or award won by the taxpayer in athletic competition in the Olympic Games." 

This would apply to prizes and awards received after Dec. 31, 2011.

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