2006-12-29 10:17:00 · 10 answers · asked by bilolo 1 in Business & Finance ➔ Taxes ➔ United States
Legally, you are required to pay taxes on any winnings, even $1.
On a prize less than a few hundred dollars, there wouldn't be any paperwork, so nobody would know what you won if you won for example $50 from your state lottery. That does NOT mean you don't owe taxes on it, just means there's no tracking of it.
2006-12-29 10:25:43 · answer #1 · answered by Judy 7 · 4⤊ 0⤋
When you win a cash or merchandise prize, the company you win it from will not withhold any taxes for you. If you win $25,000, you'll get a check for $25,000.
Then, in January the next year, you'll get a 1099-MISC from that company showing they paid you $25,000. You need to claim that as income on your tax return.
They are required to send you (and the IRS) a 1099-MISC for all wins over $600. However it all really depends, some places may not know all the IRS regulations and fail to send you this form, and other places over-do it and send you a 1099 even for wins under this threshhold.
To do things correctly, though, you need to claim all cash winnings, and the fair market value of all merchandise wins, as income, regardless if it's over or under $600.
2006-12-29 10:46:49 · answer #2 · answered by NQDenise 2 · 2⤊ 1⤋
It doesn't matter who much you earn. You have to pay taxes on any and all monies you win/earn. It is true, you will not receive any documentation for less than 600. That does not make it any more legal/illegal. It is your responsible to keep up with the winnings and report them.
2006-12-29 10:43:09 · answer #3 · answered by Anonymous · 1⤊ 1⤋
I believe it's $600 in a year from a single source. At that point the company where you won the prize(s) should send you a 1099-MISC form and you have to record that income on your taxes.
2006-12-29 10:20:00 · answer #4 · answered by Anonymous · 0⤊ 3⤋
no use to worry about that, cause they take tax money out on everything that u win.
2007-01-02 06:42:43 · answer #5 · answered by thedawg 1 · 0⤊ 0⤋
It depends on how much income you have for the year excluding your winnings. You will add your winnings to your other income to determine your total tax bill.
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2006-12-29 10:21:29 · answer #6 · answered by Serendipity 7 · 1⤊ 1⤋
I thought they take taxes out of all prize money. heck they took taxes outta my bonus check!
2006-12-29 10:19:50 · answer #7 · answered by Anonymous · 0⤊ 1⤋
anything over 599.00 you need to give SSN number and all so the winnings can be reported. Anything else is up to you to track and report.
but remember you are also allowed to deduct your loses from gambling as well.
2006-12-29 10:56:20 · answer #8 · answered by singledad 7 · 2⤊ 0⤋
Any money, even 1 cent, the government wants its share.
2006-12-29 10:21:43 · answer #9 · answered by Anonymous · 2⤊ 0⤋
I think it depends where you live. I've heard it's anything over $1200 in one winning, like from a slot machine.
2006-12-29 10:26:04 · answer #10 · answered by wannaknow 3 · 0⤊ 3⤋