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Taxes On Game Show Winnings
Are Canadians Eligible To Be On A US Game Show?
The answer to this question depends on the individual US game show. The longest running and most watched game shows amongst Canadians are the Price is Right, Wheel of Fortune, and Jeopardy. All three of these US game shows allow Canadians to audition for their show. Please check the various American game show websites for details.
Are Game Show Winnings Taxed?
It depends. Assuming you have appeared on a US game show and have won some money/prizes, you most likely would have been assessed tax on your game show winnings. Game show wins of $600 USD or more are taxed. Thus if you received only a pair of pantyhose as a parting gift, no taxes will be assessed by the IRS.
How Will I Be Taxed If I Win A Game Show Prize, And Not Cash?
The IRS taxes you on the cash value of any game show prizes received. For instance, if you win a sofa that sells for $750 USD, you will have to pay $225 USD (30% of the $750 USD) as a game show tax. IRS taxes are not easy to escape. In a famous 1970s case, a Canadian game show contestant won the Price Is Right's Showcase Grand Prize. Unfortunately she could not afford the taxes on her game show win, and encountered major difficulties when she attempted to cross the border.
Will The IRS Refund The Game Show Tax To US Non-Residents?
For Canadians, any gambling losses incurred in the same taxation year as your game show win can be used to partially or fully offset the taxes on your game show winnings. For example, if you win $ 2000 USD on Jeopardy, you are taxed $600 (30% of the game show winnings). If you have an equal or greater amount of US gambling losses (of any kind) in the same taxation year, all your game show taxes ($600 USD) will be refunded by the US government.
If your total US gambling losses are less than your game show winnings in the same taxation year, you will receive a partial tax refund of the game show tax withheld by the IRS. Using the same example earlier, if you have $2000 USD in game show wins, yet your gambling losses amount to $1000 USD in the same taxation year, you will get a partial tax refund from the Internal Revenue Service. In this case, your gambling loss of $1000 USD is subtracted from your game show win of $2000 USD, resulting in a net income of $1000 USD. The net income of $1000 USD will then be taxed at a rate of 30%, resulting in game show taxes of $300 USD. Since you have taxes withheld on the full amount of your game show win ($600 USD), you can anticipate receiving $300 USD as an IRS tax refund.
International game show winners from treaty countries (as listed in the Gambling Tax Refund Eligibility page) can file for a full refund of any withheld game show winnings taxes. Foreign winners from non-treaty countries will need to claim their US gambling losses against their game show wins for a partial or full gambling tax refund.
Is There Game Show Winnings Tax On Reality Shows?
The IRS rules for game show tax and their refunds are vague. But in general, reality show winners are taxed at the same rate as regular game show winners. Some reality show contestants have attempted to reclaim parts of their IRS withholding tax with their U.S. gambling losses. One Survivor reality show winner, Richard Hatch, neglected to pay withholding taxes on his game show prize. He was prosecuted and ultimately convicted of tax evasion.
What Documentation Do Game Show Winners Need?
If you win at a US game show, you are given an IRS Form 1042-S. If you lose or misplace this form, the production studio can provide you with a copy. In addition, game show winners should keep supporting documentation of their U.S. gambling losses. Old lottery tickets, race stubs, records of slot machine plays, are all considered to be supporting evidence of gambling losses. The supporting evidence must be related to gambling losses at a US-based casino or other US gambling establishments, and must occur in the same calendar year as the game show winnings.
In order to reclaim the withheld game show winnings tax, Box 1 of your IRS Form 1042-S (Income Code) must read 28. "28" denotes eligible gambling income. Game show winners often are issued Form 1042-S slips with income codes of 50. Code "50" is not eligible for any tax refunds. Only game show winners with income code "28" on their 1042-S forms are eligible for a refund of taxes paid.
How Can U.S Gambling Refund Help You Reclaim Taxes On Your Game Show Wins?
The IRS tax codes are notoriously complicated yet vague. US non-residents attempting to reclaim their game show winnings tax face extra obstacles that do not exist for US residents. US Gambling Refund has many years of academic and real-world experience. Our staff is knowledgeable of both US and Canadian tax laws. US Gambling Refund has successfully obtained US game show refunds for both Canadian and international clients.
If you have won game show cash and/or prizes, click the link below to request a tax application package. Don't hesitate! Recover your game show taxes now!