Do Olympians Pay Taxes on Their Medals? Tax Hacks for Winning Athletes

Do Olympians Pay Taxes on Their Medals? Tax Hacks for Winning Athletes

Hey there, athletes! It’s your friendly CPA team at Insogna CPA, here to share some smart tax tips tailored for your Olympic triumphs in 2024. Taxes might sound like a hurdle, but we’ve got the insider tips to help you keep more of your hard-earned prize money and NIL (Name, Image, and Likeness) earnings in your pocket.

❓ What Are Taxes?

When you’re cashing in on those Olympic prizes and NIL earnings, Uncle Sam wants a slice of that pie. And it’s not just federal income tax you need to think about—FICA payroll taxes are in play too, covering Social Security and Medicare.

But don’t stress! We’re here to break down how setting up an LLC-SCorp can help you sidestep some of those tax hurdles and save you money. Think of it as a victory lap for your wallet.

❓What Is My Tax Responsibility?

Whether you’re a gold medalist or just starting to cash in on your NIL, the IRS expects its fair share. But with smart planning, you can minimize your tax bill and keep more of your Olympic prize and NIL money for yourself.

🚩 Consider Setting Up a Business Entity

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💵 Keep Track of Your Expenses

Every gold medal comes with a price tag, and so do your NIL earnings. Training, travel, equipment—they all add up. But here’s the good news: many of these expenses can be deducted from your taxable income, saving you money.

Keeping organized records is key, so consider setting up a separate LLC account for your business transactions. With a CPA on your team, you’ll know exactly what you can deduct, helping you keep more of your earnings.

💡 Plan for Self-Employment Taxes

As an Olympic athlete with NIL earnings, you’re essentially running your own business, which means you’re responsible for self-employment taxes. This includes both the employee and employer portions of Social Security and Medicare taxes. Planning ahead and setting aside funds for these taxes is crucial to avoid any unpleasant surprises.

Pro tip: A CPA can help you budget and make sure you’re on track with your tax payments, so you can focus on what you do best—winning.

💵 Save for Retirement

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💡 Understand State Tax Implications

If your Olympic journey takes you across state lines, you might owe taxes in more than one state. This can get tricky, but with a CPA’s help, you can navigate the maze of state tax rules and make sure you’re in compliance no matter where you earn your money.

💬 Seek Professional Advice

Here’s a crucial tip: always seek advice from licensed professionals. A CPA is your go-to resource for managing your finances and taxes, ensuring you’re making the best decisions for your future. Don’t cut corners—invest in quality advice to protect your hard-earned cash.

Ready to score a win for your finances?

Reach out to us today, and let’s make sure your Olympic earnings work as hard for you as you did to earn them. We’re here to help you navigate the tax game and set you up for a financially secure future. Don’t wait—get in touch now and let’s secure your victory lap!

Insogna CPA