What would you do if you won this HGTV home worth $600K?

[The Colorado Kid]

What would you do if you won this fully furnished home?
Would this be a windfall or a downfall?
Is the $50K cash enough to pay the taxes on this prize?
If you sold it right away what would the additional tax impact be?

HGTV Urban Oasis 2021 Sweepstakes Prizes | HGTV Urban Oasis Sweepstakes | HGTV

The grand prize package includes:

• A charming 3-bedroom, 2-1/2 bathroom home located in Indianapolis, Indiana
• $50,000 from LendingTree
• Beautiful furnishings inside and outside

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[Passepartout]

I'd have something on the market within minutes! But then I'm not going to register to win it, so that's a moot point.

 

[amycurl]

I'd sell it. I mean, Indianapolis, really?

 

[The Colorado Kid]

I'd sell it. I mean, Indianapolis, really?

@amycurl No Airbnb for you eh?!

 

[mrsstats]

I would sell it and buy where I really want to move

 

[rickandcindy23]

I would sell it and buy where I really want to move

Me too! I liked the one in North Carolina a while back. I tried to win that one.

 

[amycurl]

The one in Asheville? That one was actually sold *by* a friend of mine; she didn't know that it would be used for this purpose (HGTV Urban Oasis) until after the sale (of course.) She did enjoy seeing the transformation take shape, however.

I've entered most of these contests (I once won round-trip biz class seats on ANA, so now I'm a sweepstakes believer, LOL!) but the only one I think I would have kept was the one in Portland, ME.

 

[clifffaith]

I enter every contest. I'd go stay there once and get the paperwork done to list it, and that would be it.

 

[CalGalTraveler]

I would evaluate the taxes. If there was a benefit to keeping, I would rent it it out for a year or so. (or Airbnb it if the area allows) to pay for the property taxes and maintenance. I then would 1031 exchange into a rental closer to our home so we could maintain it more easily as a rental.

 

[wackymother]

I thought the HGTV contests offer a cash alternative? Or is that only in my fevered imagination?

 

[dioxide45]

I'd sell it. I mean, Indianapolis, really?

Rather offensive to the people that live in Indiana and Indianapolis, don't you think?

 

[Luanne]

Rather offensive to the people that live in Indiana and Indianapolis, don't you think?

No more offensive than those who badmouth other cities.

 

[The Colorado Kid]

I would evaluate the taxes. If there was a benefit to keeping, I would rent it it out for a year or so. (or Airbnb it if the area allows) to pay for the property taxes and maintenance. I then would 1031 exchange into a rental closer to our home so we could maintain it more easily as a rental.

@CalGalTraveler - great strategy...if I remember properly the 1031 shelters the sale from taxes?

 

[geist1223]

The $50K Cash would not even come close to paying the Federal Taxes let alone any State Taxes. You would be taxed at the value placed on the House and Furnishing by HGTV. I would take the $50K and the cash offer of the Grand Prrize. Pay the taxes and invest in improvements in our house in Salem.

 

[SmithOp]

Might have to sell to pay the income tax, sweepstakes gifts get a 1099-Misc that will get reported on line 21 - Other Income.

Maybe the $50k will cover it, live in it 2 years then sell, pay no cap gains on the appreciation.


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[Ty1on]

LMAO. New rule, city or state names may not be mentioned in threads, so as to avoid the downward spiral of geoshaming.

 

[wackymother]

I looked at the rules. There is an option to take $300,000 cash.

 

[tschwa2]

I would be willing to try that new state for a couple of years at least. Even better if I could donate my current house and use the donation to offset the taxes. Or sell my current house and donate half the proceeds to offset the win. My house if sold as is is probably worth $175,000 and I still owe $70,000.

 

[CalGalTraveler]

@SmithOp Love the strategy. If you have a job that enables you to work from anywhere it would work. You only need to live there 6 months and 1 day out of the year. Then rent out your current home for 6 months to help offset expenses.

Just curious: If you must pay taxes upfront on the acceptance of the home, wouldn't that increase your base so capital gains wouldn't matter?

 

[dougp26364]

Because I can work almost anywhere, I think I’d sell my existing house and move. It’s not as if I currently live in a desirable urban location, so what the heck.

 

[CanuckTravlr]

No decision making needed here. The contest is only open to US residents.

 

[geekette]

I'd sell it. I mean, Indianapolis, really?

Hey! The circle city was a great home for me for over 3 decades. Jobs, good cost of living, best interstate access,world class airport, test market so lots of great restaurants, arts,parks, dog friendly... it’s a great place to live. If you want to live there.

 

[geekette]

LMAO. New rule, city or state names may not be mentioned in threads, so as to avoid the downward spiral of geoshaming.

Extra bonus points for coining a new term!!

 

[geekette]

@SmithOp Love the strategy. If you have a job that enables you to work from anywhere it would work. You only need to live there 6 months and 1 day out of the year. Then rent out your current home for 6 months to help offset expenses.

Just curious: If you must pay taxes upfront on the acceptance of the home, wouldn't that increase your base so capital gains wouldn't matter?

Taxes are not part of cost basis on a home.

 

[am1]

Rather offensive to the people that live in Indiana and Indianapolis, don't you think?

It is what it is. One reaps what one sows.