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Jerry
Jerry UltraDork
12/28/16 8:23 a.m.

My mom had sent me this graphic about 2 weeks ago and said "look what Mindi won!". I didn't see it till later, figured it must be $500 or something, never heard anything else about it.

Picked up mom & taking her to the ss's house for Xmas, mom says "I guess we'll get to see the new car". Wait, she really won the car? Turns out yes, she bought 2 chances mostly because it was benefiting her school's sports team or something, but for a $50 investment she won a new car.

I asked about it, because I've always been curious about when people win a new car on TV or whatever. Yes, they had to pay the taxes, which are about $7k. It had IN dealer plates, didn't ask about that but assuming they'll get regular OH plates soon. It only has an automatic, no other options, and had 400 miles when they got it, from being tooled around town to promote the contest.

4 cylinder turbo, base as you can get. I didn't even go out to sit in it (1- I don't like her or her shiny happy person husband and 2- really could not care less about Camaros) but first thing her grandmother said was it has a terrible back seat and back window.

So it just proves that terrible people can still step in E36 M3 and come out smelling like roses.

captdownshift
captdownshift PowerDork
12/28/16 8:29 a.m.

So you'll be bringing it to the challenge?

eastsidemav
eastsidemav SuperDork
12/28/16 8:53 a.m.

Was that Oak Hills? It sure likes like their lettering.

Dr. Hess
Dr. Hess MegaDork
12/28/16 8:54 a.m.

They put 4 cylinder automatics in those things? No wonder they were trying to give it away. I think I would have taken the 15 large.

Anyway, good for her.

Jerry
Jerry UltraDork
12/28/16 9:00 a.m.

In reply to eastsidemav:

Yup. She lives about .25 miles away, but apparently the dealership was just over the border to IN. Forgot to ask who gave it away.

And yes, I would have taken the $15k before they even finished telling me I won. shiny happy person was going on about how much the car was worth, quick Google search showed $25.7k base, figure $27 for the auto. $7k in taxes, for a car they really didn't need anyway? Oh yeah, show me the money!

STM317
STM317 HalfDork
12/28/16 9:11 a.m.

In reply to Jerry: Wouldn't you have to pay income tax on the cash? Usually gambling winnings are taxed at 30% So you'd end up with $10k-ish profit if you took the cash.

If you take the car, you have to pay 7k in taxes/title/fess/etc, but you end up with a 25k car that should be easy to sell for over $20k. Subtract the 7k you gave out of pocket, and you get at least 13k in profit.

The car doesn't sound like a bad deal to me.

bentwrench
bentwrench Dork
12/28/16 9:31 a.m.

I don't know any one who would buy a base camaro with a automatic banger, turbo or not.

M2Pilot
M2Pilot HalfDork
12/28/16 9:33 a.m.

In reply to STM317:

Yes, you have to pay taxes if you take the cash option. I took the cash option when I won the M235i last year. It was a $42.5K car & taxes were withheld from that. I got a check for approx. $30K & a federal tax form (not a 1099) titled "certain gambling winnings", that documented value of car & taxes withheld. When I filed tax returns, the $30K was reportable as gambling winnings but I could deduct the cost of raffle tickets & any other gambling loses from that.

When I won the Range Rover it was from a sweepstakes. There was no cash option. I paid state sales taxes & registration fees up front & received a a 1099 tax form & had to pay taxes when I filed returns.

When your stepsister files 2017 tax returns, she may be able to modify the amount stated on her 1099 if she can demonstrate that the value of the car is actually less than MSRP. If she can document that like equipped camaros were retailing at a less than MSRP she might save a few bucks. Copies of ads, rebate offers, etc could help if she chooses to take this route. She might take it to Carmax or whoever & get an offer to buy in writing & use that figure to modify amount on 1099. I'd get a tax professional to help me on this.

Congratulations to your stepsister. This may not be a car any of us lust after but it's a nice windfall for her.

Streetwiseguy
Streetwiseguy PowerDork
12/28/16 9:45 a.m.

A stripper 4 cylinder Camaro interests me, if only from the "Lets see how hard we can boost this thing, and if it blows up we can swap in a horrific V8" and stuff'n'things.

Enyar
Enyar Dork
12/28/16 10:18 a.m.
M2Pilot wrote: In reply to STM317: Yes, you have to pay taxes if you take the cash option. I took the cash option when I won the M235i last year. It was a $42.5K car & taxes were withheld from that. I got a check for approx. $30K & a federal tax form (not a 1099) titled "certain gambling winnings", that documented value of car & taxes withheld. When I filed tax returns, the $30K was reportable as gambling winnings but I could deduct the cost of raffle tickets & any other gambling loses from that. When I won the Range Rover it was from a sweepstakes. There was no cash option. I paid state sales taxes & registration fees up front & received a a 1099 tax form & had to pay taxes when I filed returns. When your stepsister files 2017 tax returns, she may be able to modify the amount stated on her 1099 if she can demonstrate that the value of the car is actually less than MSRP. If she can document that like equipped camaros were retailing at a less than MSRP she might save a few bucks. Copies of ads, rebate offers, etc could help if she chooses to take this route. She might take it to Carmax or whoever & get an offer to buy in writing & use that figure to modify amount on 1099. I'd get a tax professional to help me on this. Congratulations to your stepsister. This may not be a car any of us lust after but it's a nice windfall for her.

Um...you won a M235 AND a Range Rover? Gambling addiction or great karma? Details?

Huckleberry
Huckleberry MegaDork
12/28/16 10:24 a.m.

I have never won anything but the 50/50 at a kids soccer game and they frowned at me until I donated the other half so I'd be stoked just to have had the luck to keep a taste of winning one time.

I would have taken the payout minus taxes and before I paid $7k out of pocket for a car I don't want but... if it tickles their udders, that's cool. I'd be riding a new moto with uncle sam's leftovers.

JG Pasterjak
JG Pasterjak Production/Art Director
12/28/16 11:01 a.m.
Enyar wrote:
M2Pilot wrote: In reply to STM317: Yes, you have to pay taxes if you take the cash option. I took the cash option when I won the M235i last year. It was a $42.5K car & taxes were withheld from that. I got a check for approx. $30K & a federal tax form (not a 1099) titled "certain gambling winnings", that documented value of car & taxes withheld. When I filed tax returns, the $30K was reportable as gambling winnings but I could deduct the cost of raffle tickets & any other gambling loses from that. When I won the Range Rover it was from a sweepstakes. There was no cash option. I paid state sales taxes & registration fees up front & received a a 1099 tax form & had to pay taxes when I filed returns. When your stepsister files 2017 tax returns, she may be able to modify the amount stated on her 1099 if she can demonstrate that the value of the car is actually less than MSRP. If she can document that like equipped camaros were retailing at a less than MSRP she might save a few bucks. Copies of ads, rebate offers, etc could help if she chooses to take this route. She might take it to Carmax or whoever & get an offer to buy in writing & use that figure to modify amount on 1099. I'd get a tax professional to help me on this. Congratulations to your stepsister. This may not be a car any of us lust after but it's a nice windfall for her.

Um...you won a M235 AND a Range Rover? Gambling addiction or great karma? Details?

+1 on this.

I mean, great comments and all, but you kind of focused on the wrong part of the story.

szeis4cookie
szeis4cookie HalfDork
12/28/16 11:10 a.m.
Jerry wrote: In reply to eastsidemav: Yup. She lives about .25 miles away, but apparently the dealership was just over the border to IN. Forgot to ask who gave it away. And yes, I would have taken the $15k before they even finished telling me I won. shiny happy person was going on about how much the car was worth, quick Google search showed $25.7k base, figure $27 for the auto. $7k in taxes, for a car they really didn't need anyway? Oh yeah, show me the money!

I think I'd have taken the car...straight to Carmax. $27k MSRP new, so as long as they offer at least $20k you're still a significant amount of money ahead.

Danny Shields
Danny Shields Reader
12/28/16 11:26 a.m.

In reply to Jerry:

Wow, that is pretty cool. Good for her. Sure, it is a four-cylinder Camaro, but it is a NEW CAR!

AWSX1686
AWSX1686 Reader
12/28/16 11:50 a.m.
STM317 wrote: In reply to Jerry: Wouldn't you have to pay income tax on the cash? Usually gambling winnings are taxed at 30% So you'd end up with $10k-ish profit if you took the cash. If you take the car, you have to pay 7k in taxes/title/fess/etc, but you end up with a 25k car that should be easy to sell for over $20k. Subtract the 7k you gave out of pocket, and you get at least 13k in profit. The car doesn't sound like a bad deal to me.

But if you're getting the car to sell the car, technically wouldn't you have to claim the sale of the car on you income too? If I had to guess, you'd probably still make a little more getting the car and selling it, plus you could drive it till right before it's due for it's first oil change and have a little fun. Just don't wreck it before you sell it!

wae
wae Dork
12/28/16 12:08 p.m.
AWSX1686 wrote:
STM317 wrote: In reply to Jerry: Wouldn't you have to pay income tax on the cash? Usually gambling winnings are taxed at 30% So you'd end up with $10k-ish profit if you took the cash. If you take the car, you have to pay 7k in taxes/title/fess/etc, but you end up with a 25k car that should be easy to sell for over $20k. Subtract the 7k you gave out of pocket, and you get at least 13k in profit. The car doesn't sound like a bad deal to me.

But if you're getting the car to sell the car, technically wouldn't you have to claim the sale of the car on you income too? If I had to guess, you'd probably still make a little more getting the car and selling it, plus you could drive it till right before it's due for it's first oil change and have a little fun. Just don't wreck it before you sell it!

I don't think you'd owe income tax on that. You'd have to claim the value of the vehicle as income for tax purposes, but the sale of the used car would be just the sale of personal property which would not be considered income.

But I'm not a CPA or tax attorney.

STM317
STM317 HalfDork
12/28/16 12:10 p.m.

In reply to AWSX1686:

I'm fairly sure that technically speaking, if you sell any tangible good for more than you paid for it, you should pay capital gains tax on the profit. However, people flip anything and everything every day and the IRS doesn't really care enough to bother with it because it's usually small amounts and doesn't happen frequently. If you start doing it regularly (like as a business), then they get pretty interested pretty fast. If it's things like real estate or investments, they monitor those very closely. If you're using Craigslist to unload some antiques you bought at an estate sale, you probably don't have to worry about it too much.

The one thing I'm not sure about here, is that the vehicle wouldn't have been purchased with the intent to sell, and wouldn't have been purchased at all really. The car was donated by the dealer to a charity, and it could be argued that the winner donated to the charity, then won the car as a prize or gift, and therefore didn't pay anything for the car. I'm not sure how/if that affects things.

Jerry
Jerry UltraDork
12/28/16 12:40 p.m.
STM317 wrote: In reply to Jerry: Wouldn't you have to pay income tax on the cash? Usually gambling winnings are taxed at 30% So you'd end up with $10k-ish profit if you took the cash. If you take the car, you have to pay 7k in taxes/title/fess/etc, but you end up with a 25k car that should be easy to sell for over $20k. Subtract the 7k you gave out of pocket, and you get at least 13k in profit. The car doesn't sound like a bad deal to me.

Without doing the math, and not sure if this is accurate or not, but if it is, then $10k vs $13k without having to deal with the hassle? It's still $10k I didn't have before. And over and done with.

STM317
STM317 HalfDork
12/28/16 1:04 p.m.

Fair enough. Having to front the money, and drive it to CarMax or someplace doesn't seem like that much work to me for the extra few thousand, but there's something to be said for taking the cash and running too.

Wall-e
Wall-e MegaDork
12/28/16 1:47 p.m.

I had watched a show about people winning prizes on gameshows and then getting hammered on taxes they didn't know they owed. It was one of the reasons many shows went to cash prizes.

AWSX1686
AWSX1686 Reader
12/28/16 2:02 p.m.

I could go either way, I mean honestly I wouldn't mind at all if I won something like this.... ;)

Brett_Murphy
Brett_Murphy PowerDork
12/28/16 2:15 p.m.

The way I look at it is winning something > not winning something.

Streetwiseguy
Streetwiseguy PowerDork
12/28/16 3:32 p.m.

Lottery winnings are much simpler, and tax free in Canada.

M2Pilot
M2Pilot HalfDork
12/28/16 11:32 p.m.
Enyar wrote:
M2Pilot wrote: In reply to STM317: Yes, you have to pay taxes if you take the cash option. I took the cash option when I won the M235i last year. It was a $42.5K car & taxes were withheld from that. I got a check for approx. $30K & a federal tax form (not a 1099) titled "certain gambling winnings", that documented value of car & taxes withheld. When I filed tax returns, the $30K was reportable as gambling winnings but I could deduct the cost of raffle tickets & any other gambling loses from that. When I won the Range Rover it was from a sweepstakes. There was no cash option. I paid state sales taxes & registration fees up front & received a a 1099 tax form & had to pay taxes when I filed returns. When your stepsister files 2017 tax returns, she may be able to modify the amount stated on her 1099 if she can demonstrate that the value of the car is actually less than MSRP. If she can document that like equipped camaros were retailing at a less than MSRP she might save a few bucks. Copies of ads, rebate offers, etc could help if she chooses to take this route. She might take it to Carmax or whoever & get an offer to buy in writing & use that figure to modify amount on 1099. I'd get a tax professional to help me on this. Congratulations to your stepsister. This may not be a car any of us lust after but it's a nice windfall for her.

Um...you won a M235 AND a Range Rover? Gambling addiction or great karma? Details?

I spend 15-20 minutes a day entering online sweepstakes. To some, this may seem to be a strange way to "waste" time but I've won some nice prizes. There's no cost except time to this. The Range Rover was the grand prize in a sweeps sponsored by Greg Norman Wineries.

I do occasionally buy raffle tickets if the prize is something I think I'd really like & I like the sponsor & number if tickets is limited. The M235i was won in a BMWCCA Foundation raffle. I took the cash option on this one & put the money with some of my money & got a Euro Deliver on a '16 M3. I'd probably have taken the car but I wanted another M that was a sedan.

Jerry
Jerry UltraDork
12/29/16 7:34 a.m.

In reply to M2Pilot:

I spend at least 15-20 minutes here and win nothing, so there's that.

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