| Author |
Message |
Dan
Guest
|
 Posted:
Wed Jul 27, 2005 11:32 pm Post subject:
Win Car, Owe Tax? |
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If someone wins a car on a gameshow, is this treated as a
taxable event or does it fall under a gift and hence not
taxable?
TIA,
Dan
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Paul A Thomas
Guest
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| Posted:
Thu Jul 28, 2005 4:00 pm Post subject:
Re: Win Car, Owe Tax? |
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"Dan" <dannospam@yahoo.com> wrote
| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event or does it fall under a gift and hence not
taxable?
|
It's taxable as a prize or award. Generally goes to Line 21
- Other income.
--
Paul A. Thomas, CPA
Athens, Georgia
taxman at negia.net
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JMc
Guest
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| Posted:
Thu Jul 28, 2005 4:00 pm Post subject:
Re: Win Car, Owe Tax? |
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| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event or does it fall under a gift and hence not
taxable?
|
It's subject to tax.
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D.F. Manno
Guest
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| Posted:
Thu Jul 28, 2005 4:00 pm Post subject:
Re: Win Car, Owe Tax? |
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|
Dan <dannospam@yahoo.com> wrote:
| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event or does it fall under a gift and hence not
taxable?
|
It's not a gift, it's taxable income to the winner.
According to SCOTUS, a gift ³proceeds from a detached and
disinterested generosity,¹ ... out of affection, respect,
admiration, charity or like impulses.¹² [Commissioner
v.Duberstein, 363 U.S. 278, 285 (1960)] The producers aren't
giving away cars out of the goodness of their hearts.
--
D.F. Manno | dfm2a3l0t2@spymac.com
"As democracy is perfected, the office represents, more and
more closely, the inner soul of the people. We move toward a
lofty ideal. On some great and glorious day the plain folks
of the land will reach their heart's desire at last, and the
White House will be adorned by a downright moron." - H. L.
Mencken, in the Baltimore Sun, July 26, 1920
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Jonathan Kamens
Guest
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| Posted:
Thu Jul 28, 2005 4:00 pm Post subject:
Re: Win Car, Owe Tax? |
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|
Dan <dannospam@yahoo.com> writes:
| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event or does it fall under a gift and hence not
taxable?
|
Taxable event.
When Oprah gave cars to everyone in her studio audience,
they were actually allowed to choose whether to (a) take the
car and pay taxes on it, (b) forfeit the prize, or (c) sell
the car immediately and pay the taxes out of the sale
proceeds.
See this article about it that ran in the WSJ at the time:
<http://www.opinionjournal.com/taste/?id=110005662>.
The WSJ ran a more recent article about this issue, which
isn't available for free from their Web site but is
available for free from other newspapers that ran the wire
story, e.g.: http://www.post-gazette.com/pg/05187/533668.stm
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Arthur Kamlet
Guest
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| Posted:
Thu Jul 28, 2005 4:00 pm Post subject:
Re: Win Car, Owe Tax? |
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|
Dan <dannospam@yahoo.com> wrote:
| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event or does it fall under a gift and hence not
taxable?
|
Taxed as a prize, reported on Form 1040 Line 21, "Prizes &
Awards."
If you can demonstrate the amount they show is too high, by
newspaper ads, etc, you can claim a lower amount that you
can prove is the true value of the new car.
__
Art Kamlet ArtKamlet @ AOL.com Columbus OH K2PZH
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David Woods
Guest
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| Posted:
Thu Jul 28, 2005 4:01 pm Post subject:
Re: Win Car, Owe Tax? |
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|
"Dan" <dannospam@yahoo.com> wrote:
| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event or does it fall under a gift and hence not
taxable?
|
How in ANY definition of the word could a prize from winning
be construed as a gift?
--
David M. Woods, EA, ChFC, CLU
Woods Financial Services
Norwood, MA 02062
www.woods-financial.com
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Harlan Lunsford
Guest
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| Posted:
Thu Jul 28, 2005 4:01 pm Post subject:
Re: Win Car, Owe Tax? |
|
|
Dan wrote:
| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event or does it fall under a gift and hence not
taxable?
|
Taxable event.
YOu will get a 1099 form end of year showing the value THEY
put on the car. When you get the car, take it immediately
to a dealer , several dealers in fact, and get written
opinions on actual selling price, which as we both know, is
NOT MSRP. Also look in the newspaper for prices of comparable
vehicles and document your prize. You'll be glad you did,
come tax time.
ChEAr$,
Harlan Lunsford, EA n LA
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Rich Carreiro
Guest
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| Posted:
Thu Jul 28, 2005 4:01 pm Post subject:
Re: Win Car, Owe Tax? |
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|
Dan <dannospam@yahoo.com> writes:
| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event
|
Yes.
| Quote: | or does it fall under a gift and hence not taxable?
|
No.
But do some legwork and see what the car is really selling
for. The gameshow will probably claim the car is worth
MSRP (to get a bigger deduction for themselves), which is
likely unfavorable to you.
--
Rich Carreiro rlcarr@animato.arlington.ma.us
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Phil Marti
Guest
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| Posted:
Thu Jul 28, 2005 4:01 pm Post subject:
Re: Win Car, Owe Tax? |
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|
"Dan" <dannospam@yahoo.com> wrote:
| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event
|
Yes.
--
Phil Marti
Clarksburg, MD
<< ======================================================= >>
<< The foregoing is intended for educational purposes only >>
<< and does NOT constitute legal OR professional advice. >>
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LoTax
Guest
|
| Posted:
Sat Jul 30, 2005 8:00 am Post subject:
Re: Win Car, Owe Tax? |
|
|
Rich Carreiro wrote:
| Quote: | .... The gameshow will probably claim the car is worth
MSRP (to get a bigger deduction for themselves....
|
I'm wondering how the gameshow would get a larger deduction
by claiming a higher FMV for the car... Anyone?
<< ======================================================= >>
<< The foregoing is intended for educational purposes only >>
<< and does NOT constitute legal OR professional advice. >>
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TaxSrv
Guest
|
| Posted:
Sat Jul 30, 2005 8:00 am Post subject:
Re: Win Car, Owe Tax? |
|
|
"Rich Carreiro" wrote:
| Quote: | .... The gameshow will probably claim the car is worth
MSRP (to get a bigger deduction for themselves), which is
likely unfavorable to you.
|
The game show would be a business with adequate accounting
records. There's no way to claim a deduction computed like
that w/o disclosing it to IRS on Form 1120, Sch M.
Fred F.
<< ======================================================= >>
<< The foregoing is intended for educational purposes only >>
<< and does NOT constitute legal OR professional advice. >>
<< >>
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<< Copyright (2005) - All rights reserved. >>
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Herb Smith
Guest
|
| Posted:
Sat Jul 30, 2005 8:00 am Post subject:
Re: Win Car, Owe Tax? |
|
|
Dan wrote:
| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event or does it fall under a gift and hence not
taxable?
|
Fully taxable, at FMV, at your highest marginal tax bracket.
If you can substantiate the FMV as being less than the MSRP
shown on the 1099 your receive, then that is the value to
claim for taxation.
<< ======================================================= >>
<< The foregoing is intended for educational purposes only >>
<< and does NOT constitute legal OR professional advice. >>
<< >>
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<< messages to this newsgroup are at www.asktax.org. >>
<< Copyright (2005) - All rights reserved. >>
<< ======================================================= >> |
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David Samuel Barr
Guest
|
| Posted:
Sat Jul 30, 2005 8:00 am Post subject:
Re: Win Car, Owe Tax? |
|
|
Dan wrote:
| Quote: | If someone wins a car on a gameshow, is this treated as a
taxable event or does it fall under a gift and hence not
taxable?
|
It is *not* a gift, and is fully taxable.
The value claimed by the company which provided the car to
the game show will be reported to you on a 1099-MISC under
"Prizes and Awards" and you must report that amount on your
federal income tax return on Line 21, "Other Income" (and
the corresponding line of your state income tax return).
Note though that, like most such prizes, the 1099 reported
value probably will be substantially higher than the fair
market value, but you can report a lower FMV if you can
substantiate it to the IRS's satisfaction.
Not only will you be liable for income tax but for sales tax
as well (and if they still do things in California the way
they used to, there likely will be a Franchise Tax Board
representative backstage who will require you to fork over a
cheque for the sales tax then and there before you can take
title to the car).
<< ======================================================= >>
<< The foregoing is intended for educational purposes only >>
<< and does NOT constitute legal OR professional advice. >>
<< >>
<< The Charter and the Guidelines for submitting >>
<< messages to this newsgroup are at www.asktax.org. >>
<< Copyright (2005) - All rights reserved. >>
<< ======================================================= >> |
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Norma Desmond
Guest
|
| Posted:
Sat Jul 30, 2005 8:00 am Post subject:
Re: Win Car, Owe Tax? |
|
|
"David Woods" <davidwoods@verizon.net> wrote:
| Quote: | "Dan" <dannospam@yahoo.com> wrote:
If someone wins a car on a gameshow, is this treated as
a taxable event or does it fall under a gift and hence not
taxable?
How in ANY definition of the word could a prize from
winning be construed as a gift?
|
that begs the question. The IRC could just as easily be
written to state that such prizes are not to be treated as
income and subject to income tax. But, as other posters
have stated in their helpful answers, it is not, and thus
such a prize is subject to income tax.
<< ======================================================= >>
<< The foregoing is intended for educational purposes only >>
<< and does NOT constitute legal OR professional advice. >>
<< >>
<< The Charter and the Guidelines for submitting >>
<< messages to this newsgroup are at www.asktax.org. >>
<< Copyright (2005) - All rights reserved. >>
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