I recently won a $10,000 motorcycle. what will I pay in taxes?
That depends on what the sales tax is in your city.
Why is the lottery called a tax on stupid people? Why should the lottery prize multiplied by the probability of winning exceed the ticket price in order for the act not to be "stupid"?
It is because it functions as a regressive tax on poor people. The economic utility of money spent on the lottery tickets is far less and uncertain when compared to the certain value it could make in the everyday life of a poor person. It is obscene the lottery is promoted to poor people when it only increases their poverty. The government selling false hope to those trapped in a bad economic reality. Reinforcing and promoting bad economic decisions. The government should sell crack on the street corners to instead of taxing the rich. It is just as repungant and highly profitable. Buying lotto tickets is a bad investment for anyone especially poor people. Not everyone that plays the lotto is stupid, some play rationally and for fun. My officemate, Bob Uomini won the lotto in 1995, 22M, actual cash out value around 7M, he took the cash. Smart, retired 18 years ago and set for life. He only played on weeks where the prior lotto sum rolled over and was not cashed out to increase his odds while still recognizing it was a losing proposition. even after that. "As a PhD mathematician Uomini knows full well the astronomical odds against winning the California lottery, but he considers the ten tickets he still purchases when the jackpot tops $10 million as an excuse for fantasizing. One of the few fantasies he indulged after winning was to endow a lectureship in honor of Chern, his favorite professor." UC Berkeley mathematics alumnus uses 1995 California lottery winnings to endow annual campus professorship
Do you have to pay tax on anything you win off a gameshow?
Like Jeopardy, do you have to pay a part of that money in tax...or The Price is Right..what if I won like $40,000 in prizes? Do I have to pay $20,000 in taxes or what?
How much is the "game show tax"?
Me and my friend is going to the Price is Right. We have heard about the taxes you have to pay for the prizes. If we win something, how much should we expect to pay and how do we go about paying the taxes?
Should the Bond's home run ball be taxed by the IRS or not?
chefantwon - good point as well. You do point out the rediculous nature of the IRS. I think it may work more like this. Tax him for the estimated value as 'income'. When and if he ever sells it, they can collect sales tax on the amount of the sale. If the ball increases in value for either owner, the IRS will collect capital gains. The only benifit to any owner would be the credit received for loss of value. Regardless, you are right, the IRS will always come out on top.