TAXES ON BIG WIN
- Thread starter sweethome
- Start date
:wave: sweethome
Are CONGRATS in order?
n/m - I see:
2009 YAHAMA WATERCRAFT WIN
http://www.sweepsadvantage.com/smf/2009-yahama-watercraft-win-t58610.0.html;msg406996#top
As to your Q - depends on your tax bracket. I look at last years income/taxes, add the ARV {or FMV - like for a trip win} then look to see where that puts us - to see if what they ALREADY withheld will be enough or not.
Last year we had $10,500 to add to our income & we ended up paying over $300 extra - over the nearly $9,000 they had already withheld.
Basically, the more you make, the more they take :cussing:
Are CONGRATS in order?
n/m - I see:
2009 YAHAMA WATERCRAFT WIN
http://www.sweepsadvantage.com/smf/2009-yahama-watercraft-win-t58610.0.html;msg406996#top
As to your Q - depends on your tax bracket. I look at last years income/taxes, add the ARV {or FMV - like for a trip win} then look to see where that puts us - to see if what they ALREADY withheld will be enough or not.
Last year we had $10,500 to add to our income & we ended up paying over $300 extra - over the nearly $9,000 they had already withheld.
Basically, the more you make, the more they take :cussing:
ARV and your taxes {TY to LIDARKSIDE}
http://www.sweepsadvantage.com/smf/arv-and-your-taxes-ty-to-lidarkside-t50686.0.html
http://www.sweepsadvantage.com/smf/arv-and-your-taxes-ty-to-lidarkside-t50686.0.html
missunder
Active member
They used to have what was called:
Income Averaging-"Method of computing personal income tax whereby tax is figured on the average of the total of current year's income and that of the three preceding years. According to 1984 U.S. Tax legislation, income averaging was used when a person's income for the current year exceeded 140% of the average taxable income in the preceding three years. The Tax Reform Act of 1986 repealed income averaging."
You might check to see if this was ever reinstated.
Income Averaging-"Method of computing personal income tax whereby tax is figured on the average of the total of current year's income and that of the three preceding years. According to 1984 U.S. Tax legislation, income averaging was used when a person's income for the current year exceeded 140% of the average taxable income in the preceding three years. The Tax Reform Act of 1986 repealed income averaging."
You might check to see if this was ever reinstated.
It does depend on your tax bracket/income level, you have to report it on your return in the year you won the prize. I won a $10,000 trip in 2009 and decided it was worth accepting since the taxes would be small in comparison to the value of the prize. I would not have been able to afford to take the trip otherwise. I only enter sweeps that I really want to win. I work for a CPA so I do know the rules. If you want to accept a prize and cannot afford to pay the taxes by the due date, you can apply for an installment agreement (but they charge you a fee to do so and charge interest & penalties on the unpaid balance). Go to irs.gov for the details or send me a personal message if you have questions. :wave: