Are Oprah's gifts (to audience) taxable?

[Tora Ziyal]

You're right, Auntiehill, though it's up to $13,000 for 2010.

Per the TurboTax website,

"If you give people a lot of money or property, you might have to pay a federal gift tax. But most gifts are not subject to the gift tax. For instance, you can give up to the annual exclusion amount ($13,000 in 2010) to any number of people every year, without facing any gift taxes. Recipients never owe income tax on the gifts.

"And you can give a total of up to $1 million in gifts that exceed the annual limit in your lifetime, before you start owing the gift tax."

The rest of the details are here: http://turbotax.intuit.com/tax-tools/tax-tips/Tax-Planning-and-Checklists/The-Gift-Tax/INF12036.html

Of course, all that applies only if Oprah's gifts are legally gifts and not prizes.

 

[Owain Taggart]

I would think now that Harpo would take care of any taxable costs so's as to not screw over the audience and create any negative press.

That's the thing though. I don't think that even if she wanted to, that she could cover all the taxes. I think whoever received the car had to pay part of the taxes. She may have paid for most of it making it easier for the winners to pay it off, but I doubt it was all of it.

 

[Tulin]

All very complicated.

In Australia a winner of the lottery(up to ANY amount!)or ANY prize does not have to pay tax on it. It is "winnings" not "earnings".

 

[Alidar Jarok]

Yeah, that would be nice. In the US, winnings (even lottery winnings) are considered earnings.

 

[RoJoHen]

Yeah, everything is income. If you found a random dollar laying on the ground, that would be income, and technically you'd have to claim it.

Gifts are weird and should not be taxed. If someone buys something, they pay sales tax on it. There should not be an extra tax if they then decide to give it to somebody else.

 

[Tulin]

So what happens when the president goes overseas and the prime minister of Whogivesafuckistan presents him with a bronzed ceremonial mummified cow turd from the year 346BC?

Does the government have to pay tax on that "gift"?

 

[RoJoHen]

So what happens when the president goes overseas and the prime minister of Whogivesafuckistan presents him with a bronzed ceremonial mummified cow turd from the year 346BC?

Does the government have to pay tax on that "gift"?

Depends on how much it's worth.

 

[gh4chiefs]

Yeah, everything is income. If you found a random dollar laying on the ground, that would be income, and technically you'd have to claim it.

Gifts are weird and should not be taxed. If someone buys something, they pay sales tax on it. There should not be an extra tax if they then decide to give it to somebody else.

Well as a couple of people have already correctly pointed out in this thread, not all gifts are taxable. The value of the gift has to exceed the $ threshold before gift taxes are due. Also, I believe its the "giver" not the "receiver" that's responsible for the gift taxes.

My only question about these Oprah show "gifts" is are they truly classified as gifts or are they considered some type of game show winnings? If they're classified as gifts, things like cars would clearly put someone over the limit. A cruise for example, would not.

 

[PsychoPere]

So what happens when the president goes overseas and the prime minister of Whogivesafuckistan presents him with a bronzed ceremonial mummified cow turd from the year 346BC?
Does the government have to pay tax on that "gift"?

Since those are gifts to the state, rather than to an individual, I would imagine (though I haven't done any research nor have any specific knowledge to back this up) that such gifts are exempt from being considered earnings.

 

[RoJoHen]

Yeah, everything is income. If you found a random dollar laying on the ground, that would be income, and technically you'd have to claim it.

Gifts are weird and should not be taxed. If someone buys something, they pay sales tax on it. There should not be an extra tax if they then decide to give it to somebody else.

Well as a couple of people have already correctly pointed out in this thread, not all gifts are taxable. The value of the gift has to exceed the $ threshold before gift taxes are due. Also, I believe its the "giver" not the "receiver" that's responsible for the gift taxes.

Regardless of the cost of the gift, I think it's absurd that it's taxable at all. If I buy a $30,000 car, and I pay for it in full, why should I have to pay extra taxes just because I intend to give it to someone else?