Tax On Paid Bid To Worlds?

[luv2cheer92]

I didn't realize that. They had a whole section on prize money being awarded to NRA's (non-resident aliens) and it talked about 30% being withheld, a 1042S, students on a F-1/J-1 Visa, and a lot of blah-blah-blah that went over my head. Then I looked up American prize money going to a foreign student athletes and it went into a bunch of other yada-yada-yada that was similar to our NCAA equivalent in different countries. I stopped reading that after the first few sentences. Catlady logic- In those cases, by the time you pay the taxes and the tax accountant to figure it out for you, you've lost money.

Haha, yea. I don't even pretend to understand how all of that works.

 

[Cheermom90]

I tried to Google specifics on this and basically what I read states prize winners are supposed to receive a 1099 on prize winnings over $600.

So do gyms get a 1099 when the bid is distributed? Or in this case is that being passed onto the athletes? What do other gyms do in this case?

 

[catlady]

So do gyms get a 1099 when the bid is distributed? Or in this case is that being passed onto the athletes? What do other gyms do in this case?

I truly, without a doubt, have no idea. There's a plethora of information you can read on the IRS website that deals with prize money and youth awards, but like all things tax and law related it has too many variables that I don't know enough about to make any sense of it. I just gave up and simply stated the "prize tax for dummies" version on another site. I'd love to hear from a gym owner, tax accountant, or CPA on this subject.