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07-01-2013, 08:41 AM
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Location: Arizona
2,364 posts, read 1,931,234 times
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I'm not really sure if this belongs in this forum, but I wasn't sure where it fit. Anyway, a local casino routinely gives away new vehicles in drawings (Jeeps, etc.) as part of it's promotions. I would imagine this is common nationwide.
I always wondered about folks that actually won one of these vehicles - aren't taxes due on such a prize? And what if one can't afford the taxes? Does the casino reclaim the vehicle?
Kind of a basic question, but I was curious how the rules applied to these kind of giveaways.
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07-01-2013, 09:33 AM
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28,460 posts, read 81,531,662 times
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Casino reports prize to IRS...
..lit us up to you to pay the taxes. If you can't afford taxes you sell the prize. There are firms that will give a cash amount instead of prize. Those firms generally are bottom feeding rip off outfits that discount prize by almost half...
The casino does not seize anything for taxes nor do they collect taxes on these kinds of giveaways. You have to file regular tax return.
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07-01-2013, 09:58 AM
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Location: The DMV
6,218 posts, read 10,258,590 times
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What chet said. Remember when Oprah gave away those cars... the audience's gratitude quickly turned sour as they realized they were on the hook for the taxes (7K?).
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07-01-2013, 11:33 AM
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Location: Sunnyside
2,008 posts, read 4,532,514 times
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Also, most of the time when you "Win a car", you actually win a 2 or 3 year lease on a car. And then after that is up you have to buy the car or trade it in.
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07-02-2013, 02:14 PM
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Location: Keosauqua, Iowa
9,550 posts, read 20,070,309 times
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Taxes aren't due at the time you claim the prize. You will get a 1099 at the end of the year reflecting the MSRP of the car and you will have to claim that amount on your taxes.
Sales tax is another matter. It would have to be paid before you register the car, and would vary by state.
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07-02-2013, 03:14 PM
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805 posts, read 1,125,856 times
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Quote:
Originally Posted by duster1979
Taxes aren't due at the time you claim the prize. You will get a 1099 at the end of the year reflecting the MSRP of the car and you will have to claim that amount on your taxes.
Sales tax is another matter. It would have to be paid before you register the car, and would vary by state.
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Though the taxpayer may end up paying a penalty for failing to make an estimated tax payment on the car.
Estimated Taxes |
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07-03-2013, 07:30 AM
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1,924 posts, read 2,265,992 times
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Quote:
Originally Posted by duster1979
Taxes aren't due at the time you claim the prize.
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Taxes are due on April 15, but they are still withheld from your paycheck throughout the year. There is no hard and fast rule about whether taxes will be withheld on the spot from gambling winnings. It varies depending on how much you win, where, and at what.
All gambling winnings are of course a part of taxable income. Even if all you do is win a $2 scratch-off ticket, your winnings are reportable as income. Losses can be used as deductions up to the amount of your winnings, but those come into play only if you itemize. The obligation to report your winnings exists whether you itemize or not. |
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07-03-2013, 11:19 AM
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Location: San Marcos, TX
2,570 posts, read 7,468,479 times
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Quote:
Originally Posted by duster1979
Taxes aren't due at the time you claim the prize. You will get a 1099 at the end of the year reflecting the MSRP of the car and you will have to claim that amount on your taxes.
Sales tax is another matter. It would have to be paid before you register the car, and would vary by state.
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Yes to this.
I won a sweepstakes once, for a $1000 gift card from Southwest Airlines, and I received a 1099 for it at tax time. |
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07-03-2013, 05:49 PM
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3,491 posts, read 5,814,887 times
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Quote:
Originally Posted by oaktonite
Taxes are due on April 15, but they are still withheld from your paycheck throughout the year. There is no hard and fast rule about whether taxes will be withheld on the spot from gambling winnings. It varies depending on how much you win, where, and at what.
All gambling winnings are of course a part of taxable income. Even if all you do is win a $2 scratch-off ticket, your winnings are reportable as income. Losses can be used as deductions up to the amount of your winnings, but those come into play only if you itemize. The obligation to report your winnings exists whether you itemize or not.
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Are you certain about everything you posted?
My understanding was that a gambler had to register themselves as a gambler (at least in some states) to be allowed to write off any losses from gambling, and they were not allowed to write off any losses for the year exceeding their gains, so it was not possible to have a negative net income effect. I had no clue on carry over of losses from one year to the next. |
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