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March 28, 2007
2d Circuit Joins 3rd, 9th & 10th Circuits: Lump Sum Lottery Payments = Ordinary Income
- Prebola v. Commissioner, No. 05-6953-ag (2d Cir. 3/27/07), aff'g T.C. Memo. 2005-261 (11/8/05)
- Watkins v. Commissioner, 447 F.3d 1269 (10th Cir. 2006), aff'g T.C. Memo. 2004-244 (10/26/04)
- Lattera v. Commissioner, 437 F.3d 399 (3d Cir. 2006), aff'g T.C. Memo. 2004-216 (9/23/04)
- United States v. Maginnis, 356 F.3d 1179 (9th Cir. 2004)
- Womack v. Commissioner, T.C. Memo 2006-240 (11/7/06)
- Simpson v. Commissioner, T.C. Memo. 2003-155 (5/23/03)
- Davis v. Commissioner, 119 T.C. 1 (7/3/02)
March 28, 2007 in New Cases | Permalink
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» No Alchemy for Lottery Winnings...Again from Taxable Talk
The 2nd Circuit joined the 3rd, 9th, and 10th Circuit Courts of Appeal today and won't allow a lottery winner to turn ordinary income into a long-term capital gain. We've written about this before (see [Read More]
Tracked on Mar 28, 2007 11:22:49 PM
Comments
Same result if you claim the lottery prize in a partnership, then sell your partnership interest?
Posted by: josh | Mar 29, 2007 12:13:44 AM
The sale of the partnership interest should produce the same result under 751(a), because the lottery payment rights would constitute an inventory item as defined in 751(d)(2).
Posted by: Brant | Mar 29, 2007 1:01:26 PM
