BILL ANALYSIS Ó
AB 1944
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Date of Hearing: May 25, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
1944 (Jones) - As Amended May 16, 2016
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|Policy |Revenue and Taxation |Vote:|9 - 0 |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill excludes from adjusted gross income under the Personal
Income Tax law, from taxable years beginning on or after January
1, 2016 to January 1, 2021, the value of any medal or prize
money or honoraria given to a taxpayer by the International
Olympic Committee or the United States Olympic Committee on
account of either the Olympic games or the Paralympic games.
FISCAL EFFECT:
GF revenue losses of approximately $100,000 in FY 2016-17,
$6,000 in FY 2017-18, and $4,000 in FY 2018-19.
AB 1944
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COMMENTS:
1)Purpose. According to the author, many other countries
compensate their Olympic and Paralympic athletes, but athletes
representing the United States compete on a voluntary basis,
unless they win a medal. The author notes that "tragically,
American athletes who do win a bronze, silver, or gold medal
are then subjected to federal and state taxes." This bill
excludes, for personal income tax purposes, the value of these
medals as well as the honoraria received for those wins.
2)Background. The US Olympic Committee (USOC) provides honoraria
to medaling athletes. In 2013, athletes were generally
awarded $25,000 for a gold medal, $15,000 for silver, and
$10,000 for bronze. The tax they pay on these honoraria
depends on their overall income.
3)Brawn over brain? California has a proud Olympic history and
is home to approximately 14% of all Olympic and Paralympic
athletes. However, athletes are by no means the only
individuals who receive a monetary award because of their
laudable accomplishments. Today, the Nobel Prize is
accompanied by a monetary award of roughly $1.2 million, but
that amount is also subject to tax.
4)Related legislation. AB 2323 (Gorell) of 2014 and AB 1786
(Wansour) of 2012 would have also created similar exclusions.
Both bills were held in the Senate Committee on
Appropriations.
Analysis Prepared by:Luke Reidenbach / APPR. / (916)
319-2081
AB 1944
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