One may have confused about paying taxes on prize wins, but yes, it is true that you need to pay for your net income, whether it is from the prize. Winning a reward from a lottery, quiz show or some other event can be a withdrawing experience, but it is significant not to expend the full quantity of your prizes. The Internal Revenue Service (IRS) taxes awards won just like any other basis of revenue. According to the IRS (www.irs.gov), prize money earned must be stated in standard 1040 tax form as “other income.” The overall amount of tax you will have to reimburse on prize earnings is founded on your bordering central tax amount plus any appropriate state taxes. You can compute an approximation for paying taxes on prize wins from your tax return from last year.
Your adjusted gross income (AGI) registered on your 1040 tax form from last year should be noted down. This amount will be registered. If you need a precise computation of the tax owed based on your revenue from this year, you need to fill up a new 1040 form with your income evidence from this year to estimate your AGI for this year.
Browse on “Bank rate: 2013 tax bracket rates” site and inquire your bordering tax rate founded on your AGI. The minimal tax rate is the rate you recompense on the final dollar you make. For example, if you make $1, 00,000 a year as a single filer, your minimal tax rate is 25 percent because $1, 00,000 falls in the $89,351 to $186,350 recorded on the chart.
Multiply the prize quantity by your minimal tax rate. This is the quantity of federal tax you will owe on the prize. If the prize is big, some of the prizes might be taxed at an increased rate. This applied to recurring payments on cash sweepstakes or other. For instance, if your earning is $50,000 a year and you are awarded a $50,000 prize, the prize money will be taxed at 25 percent till $89,351, but the remaining of the prize will lie in an increased mount of tax support, in this case at 28 percent.
Sum your state’s applicable taxes to the amount from considering the entire amount of taxes payable on the prize. State income tax rates differ. The department of income website for your state should list tax rate info. If the state tax rate is 10 percent, reproduce the money prize amount by 10 percent the result is to be added to the calculated minimal tax.
If someone has confusion about paying taxes on prize wins, he should consult with tax expertise who can suggest him properly for this issue.
Get more info at: http://www.irs.gov/
Winning the forever prize is my wish . I’ m hoping to get a reward and i make a plan what to do with the winning that will benefit many. Crossing my fingers and waiting for the moment.
Winning the forever prize is my wish . I’ m hoping to get a reward and i make a plan what to do with the winning that will benefit many. Crossing my fingers and waiting for the moment.
Entry to ein
I need to win it all so I can take care of my 80 year old mom because I am struggleing with her health an mine an it has been hard an to help my kids an grandkids it has been rough with just me taken care of her I just realy need to win I have never won anything in my life this would be a gift from god.
I know that dreanms really do come true if u believe and have consistency in your life and action’s never give up always family peace and love please come c me in lufkin Texas with the super prize check so I can buy me and my children our very first home of our own to start a life in I enter your sweeps consistent every day for two year’s now and I know in my heart one day my dream will come true and I will win I truly believe that. Thanks PCH
I’m happy to see others winning.
I hope I be that lucky one
My husband and I lost everything our son an home due to drugs an we hit rock bottom. We both got clean an got our son back an is living in a two bedroom apartment where we have to have a cosigner. It’s been a tough journey to hell an we are greatfull for our life but winning this money would help us buy our dream house an to give our son things he deserves such as confidence that we will always be together.
We would love to win. Both my wife and I are in our eighty’s and starting to spend down our money.
Winning this prize take the pressure and relax and help our children and grandchildren.
Gotta win to pay taxes no problem let me win I would pay my taxes so pick me give me dreams come true!!
Money can change my struggle. But my passion is to change the world. love peace and power.