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If I win the dream house from hgtv would this be ...

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If I win the dream...
If I win the dream house from hgtv would this be considered ordinary income or passive income or what ($2.2 million prize). How much would I owe on it taxwise. I know I would have to pay real estate closing costs.
Submitted: 9 years ago.Category: Tax
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Answered in 7 minutes by:
2/2/2008
Tax Professional: jgordosea, Enrolled Agent replied 9 years ago
jgordosea
jgordosea, Enrolled Agent
Category: Tax
Satisfied Customers: 3,161
Experience: I've prepared all types of taxes since 1987.
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Greetings,

Prizes and awards are ordinary income reported on line 21 of Form 1040.

A single person with no other income and the standard deduction would pay tax for year 2007 of $746,805 on a prize of $2,200,000. A married filing joint couple with no other income and the standard deduction would pay tax for year 2007 of $737,688 on a prize of $2,200,000.

I hope this is the information that you need.

Best wishes (and good luck!).

 

 

jgordosea
jgordosea, Enrolled Agent
Category: Tax
Satisfied Customers: 3,161
Experience: I've prepared all types of taxes since 1987.
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