March 1, 2011 – 9:51 am
Gary Hershorn/Reuters
Actual Oscar statuettes to be presented during the 80th Annual Academy Awards sit in a display case in Hollywood.
Academy award nominess, even those that didn't win an award in Monday night's 83rd Academy Awards walked away with gift baskets filled with expensive swag, with an estimated value of over $100,000 according to a Fox Business report.
But, did you know that the value of these bags is actually taxable?
In August 2006, the Internal Revenue Service announced an agreement between the tax agency and the Academy of Motion Picture Arts and Sciences regarding the taxability of such gift bags.
Under the agreement, recipients of gift baskets are issued appropriate informational tax forms by the Academy and will be responsible for satisfying their income tax obligations. From a tax perspective, the recipient of the gift bag is deemed to have received taxable income equal to the fair market value of the bag and its contents and must report that amount on his or her income tax return.
The gift basket can sometimes also include non-transferable certificates for hotels or personal services, which would only be taxable if actually redeemed.
Read the full IRS Q+A here.
Posted in: Personal Finance, Tax Expert Tags: Academy Awards, benefit, golombek, irs, Oscar, tax
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