Tax News Oscars and the Taxation of “Swag Bags” Read the Article Open Share Drawer Share this:Click to share on Facebook (Opens in new window)Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Pinterest (Opens in new window)Click to print (Opens in new window) Written by TurboTaxLisa Published Mar 10, 2023 2 min read The outfits are picked, parties planned and the votes for the 2023 Oscar winners will be tallied. This weekend, Hollywood’s nominees will gather for the 95th Academy Awards ceremony. And while most hopefuls will not be walking away with the coveted eight-and-a-half pound (yes, really) statuette…they will still have something to smile about. This year’s “swag bag” – given to all Academy Award nominees – is said to have a whopping estimated value of well over six figures. It’s not “just an honor to be nominated,” it pays! But what are the potential tax ramifications of receiving luxury vacations to Italy and Canada, facial rejuvenation procedures, or luggage sets (to name just a few of the expensive items included in the swag bag)? For starters, the recipients will need to claim the fair market value of the bags as ordinary income rather than as a gift. A 2006 agreement reached by the IRS and the Academy of Motion Picture Arts and Sciences created this rule. Assuming the celebrity is in the highest tax bracket and a 37% rate applies, this year’s swag comes with a hefty tax price tag that could be close to $50,000 depending on the exact value of the swag bags. That may have some celebs seeing a red light rather than the red carpet. On the bright side, recipients of the goodie bags are allowed to donate the gifts to charity and receive a tax deduction, but they still have to claim the gifts as income. You may not have an Oscar nomination in your future, but any winning bets you place on Oscars nominees, as well as any other gambling, lottery, raffle and sweepstakes winnings are taxable income. TurboTax will ask you about winnings and will help you every step of the way if you had a very lucky 2022. Ready for that refund? File today! Don’t worry about knowing these tax rules. Meet with a TurboTax Full Service expert who can prepare, sign and file your taxes, so you can be 100% confident your taxes are done right. Start TurboTax Live Full Service today, in English or Spanish, and get your taxes done and off your mind. You don’t have to leave home, and you can be ready for the Oscars! Get started now Previous Post IRS Issues Guidance on the Taxation of State Tax Payments… Next Post Tax Tips for Unemployment Income If You’ve Been Laid Off… Written by Lisa Greene-Lewis Lisa has over 20 years of experience in tax preparation. Her success is attributed to being able to interpret tax laws and help clients better understand them. She has held positions as a public auditor, controller, and operations manager. Lisa has appeared on the Steve Harvey Show, the Ellen Show, and major news broadcast to break down tax laws and help taxpayers understand what tax laws mean to them. For Lisa, getting timely and accurate information out to taxpayers to help them keep more of their money is paramount. More from Lisa Greene-Lewis Follow Lisa Greene-Lewis on Twitter. Leave a Reply Cancel reply Browse Related Articles Self-Employed Is Your Pet Insta Famous? Here’s What It Means fo… TurboTax News #LittleLifts: A Little Lift for Julz TurboTax News TurboTax #LittleLifts Sweepstakes Winners Tax News A Century of Income Taxes: The History of Tax Day [Inf… Business Small Business: What Are Deferred Tax Assets and Deferr… Tax Deductions and Credits What is the State and Local Sales Tax Deduction? Tax Reform Tax Reform 2017 Bill Finalized: Here’s What Goes to V… Tax Refunds Payroll Tax Changes Affect the Way Americans Spend and … Tax Reform New! TurboTax Tax Reform Calculator Educates on How Tax… Taxes 101 Can I File Exempt & Still Get a Tax Refund?