justiceserenity
Member
Hey there!
So I did my taxes already, but my question is about my fiances.
He won $10,000 in gift cards last year and we are working his taxes on turbo tax. Something doesn't look right when entering the 1099-Misc form the win, however.
His income (filing alone) is $50,300 between two different jobs. When he enters in both W2s, it's showing he's getting back a little over $3k from Fed and $1k from State. (He takes out a lot).
However, when we put in the $10K 1099, it's now showing that he OWES over $600 in fed and only getting back a little over $200 in state. This is about a $4,500 difference.
From my understanding, your sweeps wins are taxed at your current tax brackets rate.. (this 10k doesn't push him into another bracket). From what I see online, that is 25% for his income for Federal. Also, from my understanding, is that California (where we live) is exempt - you don't pay taxes on prize winnings or lotteries. If that's true, why did his state tax refund go down $800?
Why is he being taxed 45% total on this?
Anyone have any insight? We may just be missing something but it just doesn't seem right.
Thanks for your help!!
So I did my taxes already, but my question is about my fiances.
He won $10,000 in gift cards last year and we are working his taxes on turbo tax. Something doesn't look right when entering the 1099-Misc form the win, however.
His income (filing alone) is $50,300 between two different jobs. When he enters in both W2s, it's showing he's getting back a little over $3k from Fed and $1k from State. (He takes out a lot).
However, when we put in the $10K 1099, it's now showing that he OWES over $600 in fed and only getting back a little over $200 in state. This is about a $4,500 difference.
From my understanding, your sweeps wins are taxed at your current tax brackets rate.. (this 10k doesn't push him into another bracket). From what I see online, that is 25% for his income for Federal. Also, from my understanding, is that California (where we live) is exempt - you don't pay taxes on prize winnings or lotteries. If that's true, why did his state tax refund go down $800?
Why is he being taxed 45% total on this?
Anyone have any insight? We may just be missing something but it just doesn't seem right.
Thanks for your help!!
