Margaret CPA in OH Posted March 30, 2011 Report Share Posted March 30, 2011 I just read about a man who, when looking through his tax records to prepare his return, found a winning ($9 million!) ticket purchased last year and due to expire the end of that very day. Just curious - would the money be taxable in 2010 (constructive receipt) or 2011 when he finally claimed the jackpot? Wish it was my client! Or me!! Quote Link to comment Share on other sites More sharing options...
Pacun Posted March 30, 2011 Report Share Posted March 30, 2011 I think it should be 2011 for a cash basis TP since no one notified him his money was available and he had no way of knowing. Neither he or his representative (non-existent) knew about the money. How about the guy who put his winning ticket on his pants and then took it to the laundry? He was in the news... I wonder if the IRS said, "you knew about your money and it was ready for you to pick up and you didn't... you now owes taxes on $200 millions". Quote Link to comment Share on other sites More sharing options...
Margaret CPA in OH Posted March 30, 2011 Author Report Share Posted March 30, 2011 Well, the person I mentioned _should_ have known but just neglected to check if he had a winner. The agency certainly had no way of knowing who won so couldn't possibly have notified him. Anyway, I'm just pondering so that I know what to do when I win the big one (I wish!). Quote Link to comment Share on other sites More sharing options...
michaelmars Posted March 30, 2011 Report Share Posted March 30, 2011 i recall some cases on this and the answer was that it was available to the winner so its 2010 income, he just didn't get around to picking it up. sort of like you getting a paycheck in dec and not picking it up till january, its still dec income since it was available to you. Besides, they usually withhold taxes on these, so go with the year they are crediting the withholding for would be the easiest and most prudent thing. when i win the big one, i'll pay any year they want me to, as long as the check clears. [have doubts about NY] Quote Link to comment Share on other sites More sharing options...
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