Solution-What amount of gross income should include

What amount of gross income should include

Reference no: EM132984623

You drive up to one of those casinos in Oklahoma and decide to play the slot machines for fun. Wow!, you won $5 million !!!

The casino bosses first say "Congratulations!" Then they say: "Oh, btw, jackpots this large we only pay out in equal annual installments over five years."
You're not too happy about that but nothing you can do about it. So you take home a check for your first $1M and think happy thoughts about receiving another $1M every year for the next four years.

Problem (a) What amount of gross income should you include on your tax return for the year of your win -

$0?
$1M?
$5M?
$1M plus the present value of the future $4M?

Reference no: EM132984623

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What amount of gross income should include

Reference no: EM132984623

Reference no: EM132984623

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