JackBauer

I don't know; I'm not a tax attorney.

Regardless, given the fact that the government is way underwater, I'm having some trouble manifesting any sympathy for a poor guy who got 30k worth of free swag and now has to pay taxes on it. Boo hoo.

If he doesn't want to pay taxes, he's free to return it.

PatriotsReign

Tell us Jack...if you made $50k a year and got what this kid got, how would/could you pay $13K in taxes? If he can't afford to buy what Jeter and the Yankees gave him, how could he afford to pay the taxes.

It wasn't like he received any money. Unless you think he should "scalp" some of the tickets to pay the taxes...but then again, he be breaking the law.

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JackBauer

If I were him, I would have kept the 250-300k baseball instead of trading it for 32k worth of crap and the privilege of paying 5-13k in taxes.

If he can't afford it personally, he can get help from his family or ask the Yankees to pay the extra tax burden.

PatriotsReign

One fact you omitted is that he did not "trade-in" the baseball for the prizes. He was trying to not be greedy and just "gave" Jeter the ball.

Again, I attend several games annually at no cost and don't get taxed. So how is this guy any different than the thousands like me?

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Real World

It's more about the point that the gubmit quickly goes after a fan who gets some tickets to a game, as opposed to focusing on some legitimate tax cheats. Tickets to a game, really? I just hope none of you are taking home any toilet paper from the office stock.

As for the tax angle on this, "gifts" are not taxable, whereas "prizes" are. So the question here becomes whether or not Mr Lopez recieved "Gifts" or won "prizes". To me, he recieved "gifts" in this instance. There wasn't any sweepstakes, or some drawing for the ball. He caught it, handed it over for free, and the team said thank you by "gifting" him tickets to every game till the season ends. If not, I would think the kid could claim the ball as either barter, or even as lost income. Maybe a tax pro could answer that. What was the value of the ball he gave up, versus the "prizes" he recieved? If he has to pay on what he recieved, then he should get credited for what he gave in order to recieve "it". Maybe someone can offer up something more concrete here.

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"The most difficult subjects can be explained to the most slow-witted man if he has not formed any idea of them already; but the simplest thing cannot be made clear to the most intelligent man if he is firmly persuaded that he knows already, without a shadow of doubt, what is laid before him."
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JackBauer

How does that change anything I said?

If he's really concerned about the money -- and he doesn't seem to be, based on the newspaper reports -- he could have easily kept the ball and made significantly more at auction.

Lottery winners are forced to pay a portion of their winnings to the IRS. What makes this guy any different?

Real World

BTW, so do Jeter, or the Yankees, have to pay tax on the value of the ball they recieved? If the ball is "worth" $250k, are they obligated to pay taxes on that, or is it a "gift" since the kid gave it to them without requesting anything in return? Hmm....

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"The most difficult subjects can be explained to the most slow-witted man if he has not formed any idea of them already; but the simplest thing cannot be made clear to the most intelligent man if he is firmly persuaded that he knows already, without a shadow of doubt, what is laid before him."
Leo Tolstoy, 1897

BSR

It doesn't. You both are supposed to be reporting it. Did you really think you were going to get some sort of bill in the mail? Its up to you to report it.

BSR

I think you would have a hard time qualifying it as a gift since there was certainly a quid pro quo involving the baseball. You can be taxed on anything from found property to rewards so I can certainly see a strong case that can be made by the IRS regarding taxation of the benefits received. If you want some reading material here is as good a place to start: http://www.irs.gov/pub/irs-pdf/p525.pdf

Think of it this way. Instead of this being about the innocent good guy sports fan. What if it were an evil (in today's society) CEO who is given access to the Presidential Suite in Maui complete with company jet by his client as a "gift". Should we use PR's standard where he receives sports tickets so every gift is non-taxable or should this CEO include the benefit on his income?

PatriotsReign

Actually, I don't owe anything since the tickets are a gift and gift aren't taxable! The tickets I get certainly aren't "Prizes"

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