Regis gives away week at St. Kitts

[pwrshift]

Regis & Kelly's morning show gave away a week's stay at the Marriott St. Kitts today - sure looks nice. They valued the gift at $8000 for those MR point hounds...and I assume that was including economy air, not biz class.

Brian

 

[dioxide45]

Regis & Kelly's morning show gave away a week's stay at the Marriott St. Kitts today - sure looks nice. They valued the gift at $8000 for those MR point hounds...and I assume that was including economy air, not biz class.

Brian

I always wonder how they calculate the value of those prizes. Do they use rack rate? Tickets really aren't purchased and reservations not made, they usually give you a time window to travel. I think the companies over value the amount so they get a bigger write off, of course that means a higher taxable income amount to the winner.

 

[pwrshift]

Do winners in the USA have to pay tax on winnings like this? If so, winning a car or a house could mean you might have to sell it to pay the tax.

In Canada there's no tax on lottery winnings, etc.

Brian

 

[mas]

Do winners in the USA have to pay tax on winnings like this? If so, winning a car or a house could mean you might have to sell it to pay the tax.


Brian

That's why I often wonder whether the big winners on shows like "The price is right" etc. really make out. So you win a luxury car or a big boat with a list price of say $50k to $80k. Tax on that has to be in the neighborhood of 50% or more with state and local tax. So I'm guessing most winners end up either refusing the gift or trying to sell it for .50 on the dollar and being lucky to break even on the deal. Some winnings, give me cash every time.

 

[m61376]

That's why I often wonder whether the big winners on shows like "The price is right" etc. really make out. So you win a luxury car or a big boat with a list price of say $50k to $80k. Tax on that has to be in the neighborhood of 50% or more with state and local tax. So I'm guessing most winners end up either refusing the gift or trying to sell it for .50 on the dollar and being lucky to break even on the deal. Some winnings, give me cash every time.

I think you can substitute the "retail value" with documentation of real market value- either an appraisal or advertisements at the same time for the same item. At least that's what I've heard wrt inflated "retail prices." However, that doesn't help when you win something big like a car and now have a big tax bite; it is true that many people sell it and then have to pay taxes on the amount they garnered from the sale.

 

[Mr. Vker]

That's why I often wonder whether the big winners on shows like "The price is right" etc. really make out. So you win a luxury car or a big boat with a list price of say $50k to $80k. Tax on that has to be in the neighborhood of 50% or more with state and local tax. So I'm guessing most winners end up either refusing the gift or trying to sell it for .50 on the dollar and being lucky to break even on the deal. Some winnings, give me cash every time.

This is why people often get more excited to win $10k versus a new car. Taxes are killers on those prizes. A former co-worker came in 2nd place on Jeopardy back when they gave trips for 2nd and 3rd place. He won a trip to Chicago. They valued the trip so high, that he could plan the trip himself for less than the taxes.

 

[dioxide45]

Do winners in the USA have to pay tax on winnings like this? If so, winning a car or a house could mean you might have to sell it to pay the tax.

In Canada there's no tax on lottery winnings, etc.

Brian

Yes, these are taxable events in the US. Growing up in Canada I am aware that lottery winnings and other prizes are tax free. It is rare however that a Canadian lottery like Super7 or 649 will ever grown in to the monster amounts in the hundreds of millions one would see in the US. So I guess it balances out.