taxes

[babeG]

so i was reading online different articles how people are saying you win a car or a trip or any big amount you will be screwed you will pay thousands in taxes retail value then state taxes etc etc i do know you have to pay taxes on wins over 600 but i got a little discouraged how do those people out there that will all the time big prizes afford all these taxes? if i win a car for 30 and pay in over 10k in taxes that is still expansive
so i guess i was wondering people stories of anyone who won big prizes their experience was it a hassle ? expansive at the end of the year?
thank you

[june2368]

I've heard a lot of people sell there prize to pay the taxes. I'll, worry about that when I need to and not until. Uncle sugar , gets enough of my money during tax season.

[SweepstakesNinja]

hi,

A couple things:

a) While 'technically' you have to pay taxes on ANYTHING you win in the USA (i.e., even a $1.00 chocolate bar), it's not really seriously looked at until you have $600 or more in winnings. HOWEVER -- the good news is -- you may be able to use certain things (i.e., software, stamp/envelope costs/etc), as a 'write-off' against your sweepstaking. (I.e., if you won a $600 prize, but it 'cost' you $100 to get that win, then it's possible that you would only have to pay taxes on the "$500" win). For that - I recommend talking to an accountant to make sure you are a-ok.

b) Nowadays, also in the USA -- more and more companies are recognizing the tax implications, and are also including a 'cash' prize with the total prize package. So for example, if you won a $50,000 car, they will 'usually' include a $10,000 "cash" prize that you can use towards paying the taxes. (So your car is a free & clear title).

Hope that helps!

Johnathan