<<The IRS ruling in such matters is that the prize is yours once it is
awarded to you by winning the drawing. If you refuse it, you are
gifting it back to the casino (which may or may not now have to pay
taxes on it, depending on several factors), but you are still liable
for the tax on it since it was given over to your possession, and
whatever brief period of time, you had control and ownership of it.>>
I'm not sure it is this cut and dried. If your name is called and you don't
"claim" it, I don't think you have "taken possession" of it. And I don't
think the casino would give you a 1099 or W-2G in that case. No paperwork
would be strong reason not to count it as income. Casinos do not usually
make out paperwork until a winner is announced. You could always just not
show up!!!!!
I'm sure circumstances will vary - and the tax situation will vary. It is
very rare that you can say something "for certain" about taxes and gambling.
Marissa and I have always been careful to discuss various options, but warn
that in the final decision "your personal circumstances" is the key. In
Revenue Procedure 77-29 (on pp 147-150 in "Tax Help for Gamblers") the IRS
themselves say and I quote: "...tax liability of each depends on the facts
and circumstances of particular situations.
Also, if you win a drawing or win a prize, you do not have to use the
paperwork amount as income as that is usually a much-inflated amount. For
all such "prizes" - gambling or not - the IRS allows the "fair market
value." I discuss that at length in the book since I have had personal
experience winning a car with a sticker price on the 1099 but I sold it back
to the dealer for a lesser amount, which I used for my tax return. You must
add a note of explanation, however.
____________
Jean $¢ott
http://queenofcomps
New blog taking the place of
Frugal Fridays. Go to
http://lasvegasadvi
and click on "Frugal Vegas."
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