C
chris
Hello, I won a sweepstakes prize last March -- a Steinway
grand piano worth $42,300. Before I could claim the prize,
I had to pay approx. $11,500 up front in taxes which was 27%
of the piano's value. Since I was never in the market to
purchase a $42K or $11.5K piano, I turned around and sold it
for $30K after several failed attempts to sell it at $35K
(via eBay and local newspaper ads). Most viewed the $35K
price as too high since the 5 year warranty was
non-transferable, was no longer brand new, etc.) For my
taxes this year, I received a W-2G (since it was treated the
same as gambling winnings) and it showed that I'd already
paid the taxes, so my taxes in general pretty much went
through as normal. However, I've since been advised that I
should've declared that the fair market value of the piano
was actually $30K since that's all I could sell it for.
Thus, I overpaid taxes on $12,300 ($42,300 - $30,000) which,
at 27%, comes about to $3321 to be refunded. Since we've
moved past 4/15, I've been advised that I could file an
amended return stating that the actual fair market value is
$30K and requesting a refund for $3321. My question to the
board: what is the fair market value of the piano that I
can claim for tax purposes? Is it the original $42,300
(which was the true, retail price of piano if I had
purchased it from a retail store) or is it the $30K that I
sold it for (since that is truly what it was 'worth' on the
open market, once it had been delivered to me and lost its
'brand new' status)? I have all the failed eBay auctions,
failed newspaper ads, and low-ball customer offers
documented. Is there any way I can get my $3321 back?
Thanks,
Chris
grand piano worth $42,300. Before I could claim the prize,
I had to pay approx. $11,500 up front in taxes which was 27%
of the piano's value. Since I was never in the market to
purchase a $42K or $11.5K piano, I turned around and sold it
for $30K after several failed attempts to sell it at $35K
(via eBay and local newspaper ads). Most viewed the $35K
price as too high since the 5 year warranty was
non-transferable, was no longer brand new, etc.) For my
taxes this year, I received a W-2G (since it was treated the
same as gambling winnings) and it showed that I'd already
paid the taxes, so my taxes in general pretty much went
through as normal. However, I've since been advised that I
should've declared that the fair market value of the piano
was actually $30K since that's all I could sell it for.
Thus, I overpaid taxes on $12,300 ($42,300 - $30,000) which,
at 27%, comes about to $3321 to be refunded. Since we've
moved past 4/15, I've been advised that I could file an
amended return stating that the actual fair market value is
$30K and requesting a refund for $3321. My question to the
board: what is the fair market value of the piano that I
can claim for tax purposes? Is it the original $42,300
(which was the true, retail price of piano if I had
purchased it from a retail store) or is it the $30K that I
sold it for (since that is truly what it was 'worth' on the
open market, once it had been delivered to me and lost its
'brand new' status)? I have all the failed eBay auctions,
failed newspaper ads, and low-ball customer offers
documented. Is there any way I can get my $3321 back?
Thanks,
Chris