Thompson bill would exempt Olympic prizes from state taxation

Olympic athletes give the games their all. The best win medals, and cash prizes from the U.S. Olympic Committee. In New Jersey, some three dozen Olympians will keep giving - they're taxed on their awards. Not any more, if a bill by two Shore state lawmakers becomes law.

Republican Senator Sam Thompson and Assemblyman Ron Dancer (R-12) are introducing measures in their respective houses to exempt Olympic awards from state income tax consideration.

"These athletes have spent immense amounts of time and money to train with hopes of representing our country at an Olympic level," Senator Thompson said in prepared remarks. "Let's make sure their Olympic dreams aren't turned into a monetary nightmare."

Citing CNN Money, Thompson said that the U.S. Olympic Committee doles out $25,000 for gold medals, $15,000 for silver and $10,000 for bronze. New Jersey winners pay federal and state income taxes not only on the prizes, but on the cash value of each medal - $564 for gold, $305 for silver.

Without a change in the law, for example, Old Bridge teen gymnastic sensation Laurie Hernandez will have to hunker down and figure the taxes on her gold and silver medals from Rio.

The Thompson bill stipulates that "gross income shall not include the value of a prize or award won by the taxpayer in athletic competition in the Olympic Games," and it would be retroactive to January 1, 2012.