Question about taxes on winning a $50k eliminator contest | TigerDroppings.com

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dustinm27
LSU Fan
Member since Oct 2008
2696 posts

Question about taxes on winning a $50k eliminator contest



I'm in a large contest with hundreds of entries that could bring the pot to nearly 50k assuming there's only one winner. I probably won't win it but I was just curious as to what the process would be if someone would win that much money and an estimate on what the taxes would be.

Not sure if this is relevant info or not but the contest is organized by a friend, so it's not through a major gambling organization or anything like that.







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OnTheBrink
Alabama Fan
TN
Member since Mar 2012
3834 posts
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re: Question about taxes on winning a $50k eliminator contest


Assuming you get paid in cash, I would not worry about it.

But, that's me, and I am not versed in tax law.

And good luck!



This post was edited on 9/16 at 10:13 am


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Teddy Ruxpin
LSU Fan
New Orleans, LA
Member since Oct 2006
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re: Question about taxes on winning a $50k eliminator contest


I'd imagine the $50,000 would be added as taxable income for the year in the simplest example, so if you made $50,000 at your job and won the contest, your taxable income for the year would be $100,000. You'd then pay the tax rate as if you earned that much this year.

Taxes are fun.

Someone correct or expand upon the above please.






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GaryMyMan
USA Fan
Lower Garden District
Member since May 2007
10795 posts

re: Question about taxes on winning a $50k eliminator contest


In the early days of the Louisiana Lottery my dad would pick up losing scratch-off tickets from gas station ashtrays. During the same time he was also a pretty heavy gambler who would do pretty well playing blackjack and craps - enough to where he had a W-2G for gambling income filed through the casino during one lucky, drunken trip. I looked at his 1040 that year and coincidentally enough he also reported a gambling loss for the exact same amount. If he ever got audited he had a moving box full of losing scratch-offs for them to look through.

So yes, you should report the income on the W-2G but you, or a good CPA, could also figure out a way to minimize the actual impact.



This post was edited on 9/16 at 11:12 am


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Anfield Road
Mississippi St. Fan
Liverpool Fan
Member since May 2012
939 posts

re: Question about taxes on winning a $50k eliminator contest


From IRS (LINK ):

You may deduct gambling losses only if you itemize deductions. However, the amount of losses you deduct may not be more than the amount of gambling income reported on your return.






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kennypowers816
LSU Fan
Houston
Member since Jan 2010
1875 posts
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re: Question about taxes on winning a $50k eliminator contest


quote:

You may deduct gambling losses only if you itemize deductions. However, the amount of losses you deduct may not be more than the amount of gambling income reported on your return.


This is the only thing I remember from my Income Tax class in college.






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CHSBears
Texas A&M Fan
Baton Rouge
Member since Aug 2007
520 posts
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re: Question about taxes on winning a $50k eliminator contest


These are the results of $20 a entry, CFB Bowl Game pool I participate in. Nobody ever receives a 1099, so no one reports it. 17-5 usually wins, if you win the tie breaker. We also have a March Madness with fewer players.

Another year's contest is over and the results are in:


1st Place: Ken Hawk $10,188.00 (60% of the pot)
2nd Place: Alex Kapres $3,396.00 (20% of the pot)
3rd Place: Billy Hargett $1,698.00 (10% of the pot)
4th Place: Michael Uilkie $1,018.80 (6% of the pot)
5th Place: Brett Henry $679.20 (4% of the pot)


CONGRATS, guys!!!






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eng08
LSU Fan
Member since Jan 2013
2110 posts

re: Question about taxes on winning a $50k eliminator contest


Hanging out near the high stakes window at the track is a great idea.





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SpidermanTUba
LSU Fan
Member since May 2004
29821 posts

re: Question about taxes on winning a $50k eliminator contest


quote:

I'm in a large contest with hundreds of entries that could bring the pot to nearly 50k assuming there's only one winner. I probably won't win it but I was just curious as to what the process would be if someone would win that much money and an estimate on what the taxes would be.

You owe taxes on it as income.

quote:

Not sure if this is relevant info or not but the contest is organized by a friend, so it's not through a major gambling organization or anything like that.



If the contest is not legal, the 5th amendment gives you the right to not claim the income - however, you must positively assert it - that is, you must inform the IRS you have unreported income but you are not reporting it based on your rights under the 5th amendment.

If you simply do not report it, you are a tax cheat.


EDIT- upon further investigation I've found out you still need to report the income, but if the source is illegal you can assert the 5th amendment and not reveal the source.

LINK




This post was edited on 9/17 at 6:28 am


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SpidermanTUba
LSU Fan
Member since May 2004
29821 posts

re: Question about taxes on winning a $50k eliminator contest


quote:

Nobody ever receives a 1099, so no one reports it.


Then everyone with gains is a tax cheat.






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Blakely Bimbo
Alabama Fan
Member since Dec 2010
1108 posts

re: Question about taxes on winning a $50k eliminator contest


quote:

Then everyone with gains is a tax cheat.


Yes, and the Aggie fan just posted (for the world to see) the results of his football poll with names and amount won.







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GenesChin
Ole Miss Fan
The Promise Land
Member since Feb 2012
11557 posts

re: Question about taxes on winning a $50k eliminator contest


quote:

that is, you must inform the IRS you have unreported income but you are not reporting it based on your rights under the 5th amendment.


Wait, so basically you say to the IRS, "I made money but not going to tell you or pay taxes on it"?






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SpidermanTUba
LSU Fan
Member since May 2004
29821 posts

re: Question about taxes on winning a $50k eliminator contest


quote:



Yes, and the Aggie fan just posted (for the world to see) the results of his football poll with names and amount won.



Yet another example of life imitating Aggie jokes.







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SpidermanTUba
LSU Fan
Member since May 2004
29821 posts

re: Question about taxes on winning a $50k eliminator contest


quote:



Wait, so basically you say to the IRS, "I made money but not going to tell you or pay taxes on it"?




Ooops - I looked it up, you DO have to tell them the amount you made - you DON'T have to tell them the source if the source is illegal. However, you must positively assert the 5th amendment to avoid telling them the source.

(see link above)






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lighter345
New Orleans Pelicans Fan
Member since Jan 2009
10512 posts
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re: Question about taxes on winning a $50k eliminator contest


Clearly he did that on purpose.





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kennypowers816
LSU Fan
Houston
Member since Jan 2010
1875 posts
 Online 

re: Question about taxes on winning a $50k eliminator contest


quote:

CHSBears








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BayouBengal
LSU Fan
München
Member since Nov 2003
26713 posts

re: Question about taxes on winning a $50k eliminator contest


quote:

Ooops - I looked it up, you DO have to tell them the amount you made - you DON'T have to tell them the source if the source is illegal. However, you must positively assert the 5th amendment to avoid telling them the source.


So why doesn't Walter White do this instead of laundering it through A1 Car Wash?






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TigerDeBaiter
LSU Fan
Member since Dec 2010
2813 posts

re: Question about taxes on winning a $50k eliminator contest


Way to be your typical butthurt loser faggie.





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