The prize was awarded by a radio station in PA.
And if I do owe, does anyone know the fed & state tax rate for winnings?
2007-12-01 13:23:01 · 8 answers · asked by Sarrah L 2 in Business & Finance ➔ Taxes ➔ United States
Congratulations, you get to file a 1040 this year. You will put the $5200 of prize money on line 21 (other income). It will bump up your income. The exact tax will depend on the rest of your income.
2007-12-01 13:43:57 · answer #1 · answered by Anonymous · 2⤊ 0⤋
They're not taxable for SALES tax in NJ - that has nothing to do with the income tax. You must report the $5200 as "other income" on your tax return and pay income tax on it. Both the federal and the state tax rates will depend on your tax bracket.
2007-12-01 14:49:42 · answer #2 · answered by Judy 7 · 3⤊ 0⤋
Groceries are not charged sales tax, but winnings of any kind are taxed as income. The rate will depend on your other income. Better consult a tax professional.
2007-12-01 13:51:00 · answer #3 · answered by RE 7 · 0⤊ 0⤋
Yes, you owe tax on your winnings. Groceries may not be taxable but you buy them with income that has already been taxed.
Congratulations on winning.
2007-12-01 13:30:53 · answer #4 · answered by shipwreck 7 · 1⤊ 0⤋
Yes, the $5200 is taxable income. It makes no difference that what its spent on is exempt from sales tax. Two different things.
2007-12-01 14:03:02 · answer #5 · answered by npk 7 · 1⤊ 0⤋
Yes as it is a capital gain...as a form of income. It would be the same as if you won a prize on a game show or a contest, lottery, etc.
Tax rate will depend on your overall income...but typically about 25%.
2007-12-01 13:33:41 · answer #6 · answered by Shaula 7 · 0⤊ 2⤋
You will probably owe federal tax on the 5200.00.
2007-12-01 14:02:29 · answer #7 · answered by Hirise bill 5 · 0⤊ 0⤋
The IRS code is complicated. You'd better call your local IRS office or a CPA who does taxes. Accepting the answer you get here could be an expensive mistake
2007-12-01 13:32:20 · answer #8 · answered by Anonymous · 0⤊ 3⤋