That's right, the IRS wants to share in your good fortune. If your wondering if a particular kind of income is taxable, you should probably assume that it is. The IRS generally says that all income is taxable, unless they tell you that it isn't. You may recall a famous TV show survivor who is having problems with the IRS because he did not pay taxes on his winnings. In fact, he has done prison time and it looks like he may be headed back to prison for not paying his taxes. Things have clearly gotten out of hand in this case. Most of the time, there are penalties and interest to pay if you are late with your taxes, not jail time.
If you won the lottery, you'll probably receive the IRS Form W-2G from the lottery commission. Most of the time, gambling proceeds are reported on Line 21 of IRS Form 1040.
So, if Vegas or the lottery pay off, don't forget Uncle Sam's share.
Brycast Financial Planning in Austin Texas --- We Can Help
Income Tax Preparation in Austin Texas
contact: service@brycast.com http://www.brycast.com/
Enrolled Agent; Investment Advisor
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