how did the I.R.S come up with anything over $ 1.200 you must pay taxs how did the pick that sume and say not $2.000 or any sume of money?
2007-06-13 13:21:10 · 6 answers · asked by DANIEL H 1 in Business & Finance ➔ Taxes ➔ United States
If you win $1, legally you have to pay taxes. The $1200 is the point at which your winnings will be reported to the IRS. Hard to tell how they picked that number - possibly because the average person might pay around $200 in income tax, and they're not going to bother chasing down amounts lower than that?
2007-06-13 14:10:19 · answer #1 · answered by Judy 7 · 0⤊ 0⤋
unearned income is taxable. In some states on lottery you pay on anything over 500. It is also held at a higher tax rate. I think it is 15%. Just like you can work under the table and make up to 400 dollars and not have to receive a tax form. I think on some things they pulled numbers out the sky
2007-06-13 14:03:23 · answer #2 · answered by Clowey 1 · 0⤊ 0⤋
At the time that the amount was placed in the IRS regulations or the laws there must have been some correlation to the expected tax. Remember that "logical and fair" are words not spoken in relation to income tax issues.
2007-06-13 13:31:15 · answer #3 · answered by ? 6 · 0⤊ 0⤋
Judy is correct. I'm not sure the IRS did pick the $1,200 amount. Congress writes the actual laws. They could have picked that number. If that is the case, the reason was probably never known to anyone.
2007-06-13 14:14:43 · answer #4 · answered by STEVEN F 7 · 0⤊ 0⤋
You must pay taxes on any amount of winnings.
2007-06-13 13:27:52 · answer #5 · answered by Mark S 5 · 1⤊ 0⤋
I dunno......
2007-06-13 13:24:19 · answer #6 · answered by Christylynn P 3 · 0⤊ 1⤋