Corvette raffles
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Melting Slicks
Joined: Dec 2005
Posts: 2,046
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From: Central Florida
Corvette raffles
Besides the entry fee for a raffle does anybony know what other expenses the winner has? I suppose there are state tax and income tax concerns. Anybody know for sure - perhaps someone who has won a National Corvette Museum Corvette?
Team Owner
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St. Jude Donor '05-'06-'07-'10
Title fees, registration fees, state tax and Federal income tax.
Melting Slicks
Joined: Jan 2006
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From: Life ain't no dress rehearsal, are you gonna wait to get your toys til AFTER you have a heart attack?
Based on a quick view of TaxCut, it looks like about 2/3 of the value of the car (est. @ 60K) is considered taxable income. This may be different at different tax brackets, though. You should verify with your own tax preparer to be sure.
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Thread Starter
Melting Slicks
Joined: Dec 2005
Posts: 2,046
Likes: 13
From: Central Florida
Followup: I e-mailed NCM and I thought you'd be interested in their response.
"Unfortunately, the IRS requires that we collect federal income taxes up front before we can release the car to a winner. We have to collect 25% of the value of the vehicle. We generally can "value" the vehicle at invoice price rather than MSRP. But the required taxes are usually around $12,000 - $15,000. The winner will receive a W-2G form indicating that they won a prize valued at $xx,xxx and they have paid in federal income taxes of $xx,xxx. The winner will report both of these amounts on their tax return. Depending on the person's tax bracket, he could owe more taxes or could get a refund for part of the taxes if he is actually in a lower tax bracket than 25%. Also some states require that you pay state sales tax in order to register a vehicle in your home state. If that is the case, then the winner may have to pay sales tax also.
We have been giving away several Corvettes a year for many years now, and I have never had anyone not take the car due to the taxes."
"Unfortunately, the IRS requires that we collect federal income taxes up front before we can release the car to a winner. We have to collect 25% of the value of the vehicle. We generally can "value" the vehicle at invoice price rather than MSRP. But the required taxes are usually around $12,000 - $15,000. The winner will receive a W-2G form indicating that they won a prize valued at $xx,xxx and they have paid in federal income taxes of $xx,xxx. The winner will report both of these amounts on their tax return. Depending on the person's tax bracket, he could owe more taxes or could get a refund for part of the taxes if he is actually in a lower tax bracket than 25%. Also some states require that you pay state sales tax in order to register a vehicle in your home state. If that is the case, then the winner may have to pay sales tax also.
We have been giving away several Corvettes a year for many years now, and I have never had anyone not take the car due to the taxes."
