Tuesday, October 31, 2006
Long time readers of this blog know that perhaps my favorite class in the basic income tax course is when I get to show the hilarious clip from The Daily Show with Jon Stewart on the tax consequences of Oprah Winfrey's gift of new cars to her studio audience. Oprah is at it again -- she had another giveaway on her October 30 show:
Every member of Oprah's audience is going home with $1,000 and a Sony DVD Handycam…but there's a catch. Oprah is challenging more than 300 audience members to donate their money to a charitable cause... The audience members can't spend their money on family members, and they'll be videotaping their stories for a future show. They only have one week to come up with a plan for their money!
The tax consequences seem straighforward -- income to each recipient ($1,000, plus fmv of the Handycam), along with a $1,000 charitable deduction to the extent the $1,000 is given to a qualifying charitable organization. Comments are open (as always). (Hat tip: Bryan Camp.)