How do taxes work for prize winnings?
Asked by: mgates
I won a radio contest, the prize was a $ 5,000 shopping spree to a sponsor’s store, and a TV valued at $ 1,449. I know I am responsible for taxes, but I am confused at how they get paid. Do they tax me upfront, and I will have to pay a certain percentage out of pocket, or do I just claim the $ 6,449 (total prizes) as extra income on my next year’s taxes, and then just get a slightly smaller tax return?
How others found here:
- IF I PAID THE TAXES ON A PRIZE WHEN RECEIVED DO I STILL CLAIM IT ON TAX RETURN?
- how do prize law work?
- how does prize tax work