So I won a photo contest with a prize msrp of around $15,000 and am not looking forward to the taxes on it. I was going to purchase a 5d2 soon but had a question. I won the contest as myself, but have since started a dba. So if I am able to buy the 5d2 before the year is over, will that apply as a deduction to help with the prize taxes?
Thanks, and sorry if this isn't the right forum.
Paul
Prize money would not be considered as a 'business income' because you have no 'cost of goods sold' to tie it to. The Infernal Revenue Service is very picky about right-offs on a Schedule C. It would be best to talk with your accountant about this, I think.
-P
Posted by Jim DeWitt on November 28, 2008 at 3:40 PM
In my experience, it is much less expensive to pay for tax advice before you file the tax return than to pay the tax advisor to go with you to the audit...
"In my experience, it is much less expensive to pay for tax advice before you file the tax return than to pay the tax advisor to go with you to the audit..."
If I ever become a CPA, Jim's quote would be in my adverts and on the sign above my door (with Jim's permission, of course).
Sage advice, Jim.
Paul, I forgot to add: Congratulations on your prize!
Discussion
4 repliesThanks, and sorry if this isn't the right forum.
Paul
-P
If I ever become a CPA, Jim's quote would be in my adverts and on the sign above my door (with Jim's permission, of course).
Sage advice, Jim.
Paul, I forgot to add: Congratulations on your prize!
-P