Uncle Sam Spoils Dream Trip To Space 656
gollum123 writes about a dream come true and a dream dashed. Brian Emmett, a software consultant from the San Francisco Bay area, entered a contest sponsored by Oracle in 2005. He answered some questions on Java coding, won a free trip into space, and then reluctantly gave it up. The latter decision came once he had computed the taxes he would have to pay on the $138,000 prize — roughly $25,000. From the article: "Since the Internal Revenue Service requires winnings from lottery drawings, TV game shows, and other contests to be reported as taxable income, tax experts contend there's no such thing as a free spaceflight. Some contest sponsors provide a check to cover taxes, but that income is also taxable."
About this taxes... (Score:1, Insightful)
Still Not a Bad Deal (Score:5, Insightful)
...all things considered.
I mean, we're talking about a trip into space. Considering the normally prohibitive cost of recreational spaceflight, $25k almost seems like a bargain. I've seen people blow that much on timeshares for goodness sake. If nothing else he could write a book about the experience and recoup some of the expense.
Re:A dream come true? (Score:3, Insightful)
(otherwise, all participants would have to pay an equal share of taxes, since their presence at the "lottery" is a service the state grants, and the winning of it _is not_)
Re:About this taxes... (Score:1, Insightful)
If $25,000 puts a software consultant into debt, it's time he looks for another job. But more likely than not, the story is just exaggerated. The issue is more of whether not the trip is worth $25,000 to Emmett.
Fool... (Score:3, Insightful)
If the guy is worth his salt, and with the publicity he would get from winning the Oracle competition, I see no reason why a decent consultant could not have that paid off in a year.
Re:A dream come true? (Score:4, Insightful)
Not that I particularly agree with the state taxing winnings, but they don't help you work, yet tax your income. How is winning something different?
Re:A dream come true? (Score:2, Insightful)
Life sucks when you make money. Or win something of value.
Re:A dream come true? (Score:5, Insightful)
Now, without "enforcement of law and public order, protection of property, economic infrastructure (roads, legal tender, enforcement of contracts, etc.), education systems, health care systems" would you be able to work?
Re:Fool... (Score:4, Insightful)
Maybe there was a lot of thing that he wanted so badly: like $200,000 sport car, $1,000,000 house,
Also the guy is 31. That means he started to work in the last years of the internet bubble yet, so there is also strong possibilty he had trouble adjusting. I have a colleague here at work that went from a 700GBP/day contract to nothing for a year followed by 300 GBP/day. This worked ok for him but at the same time, there are tons of stories of consultant buying 1,000,000 GBP houses that had a difficult reality check in 2001.
Re:A dream come true? (Score:3, Insightful)
Well, without all that would you be able to collect your prize?. Would Oracle have been able to organise the contest?
Hmmmmmmn. I still don't really see a difference between govt taxing earnings & govt taxing prizes.
No way. (Score:5, Insightful)
Re:What a wonderful demonstration of.... (Score:3, Insightful)
Income? (Score:5, Insightful)
This kind of reminds me of property taxes, where someone walks up to your house, says "I reckons she's worth about this much, so you pay me that much", despite the fact that your house is earning you no income and will be taxed anyway when sold or inherited. It doesn't make much sense.
I'm a believer in financing the state through taxes. But I'm also of the opinion that there should be some kind of logic to tax. Charging people money for something when they haven't actually made any money, or indeed materially benefited in any way, as in this case is like something out of a one dimensional folk tale. When tax is levied, there should always be a question, why is it being levied?
We need taxes. But we also need to remember that the government is not our landlord. It is wrong to have a tax on simply being alive. Tax should be avoidable, if you have no money to pay any.
Re:About this taxes... (Score:4, Insightful)
Re:Fool... (Score:3, Insightful)
Re:What a wonderful demonstration of.... (Score:3, Insightful)
When you travel in the US you never know how much it is until you pay. And if you ask beforehand how much the local tax is, they give you nasty looks like you were insulting their dear mothers.
It's a completely braindead system.
Re:About this taxes... (Score:3, Insightful)
That's an urban myth for people who employ other people who don't understand tax brackets. You can never lose money by increasing your pay unless the higher bracket is taxed at greater than 100%. I seriously doubt that is the case, anywhere!
He gave up too soon!!! (Score:2, Insightful)
Re:About this taxes... (Score:4, Insightful)
If You Didn't Vote Libertarian Then Don't Complain (Score:1, Insightful)
http://www.fairtax.org/ [fairtax.org]
Like the cliche says: "Insanity is doing the same thing over and over again and expecting different results." The U.S. Tax code has been re-engineered for one purpose to empower the powerful "Professional Politicians" and special interest groups and lobbyist, while holding back the common man. We went to war against England over a 1/2% tax on tea.... Then again the British Pound Sterling was worth a lot more than our current neutered U.S.
Dollar.
Re:About this taxes... (Score:4, Insightful)
Re:A dream come true? (Score:5, Insightful)
Life still sucks more when you don't.
Re:American's don't have to pay taxes? -nonsense (Score:3, Insightful)
The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.
Ratified 02/13/1913
Zeno's Paradox reworked (Score:5, Insightful)
Therefore, Zeno might say [wikipedia.org], the swiftest accountant can never overtake the tax man. Thus, while common sense and common experience would hold that a company can pay its taxes, according to the above argument, it cannot; this is the paradox.
That's some Bad Tax Advice (Score:5, Insightful)
As the article and any decent tax account would tell him, he would not be responsible for any tax unless and until he actually accepted the ride into space. This means he could have put off on any decision on whether to accept the prize until the very last minute. At least as far as the tax man is concerned.
The only craft that matches the specs of those announced in the contest press release are those of the Virgin Galactic SpaceShip 2. And since Virgin Galactic's commercial craft is a minimum of 2 years from sending customers into space, he had at least that much time to defer his decision. His financial situation could be much improved by then. Since space craft are rarely delivered on schedule, he would likely have had even more time to defer his decision.
Then there's the possibility that he could have worked his way out of paying much of any tax at all. As others have suggested, if he could have taken some on professional duties in the form of writing about his voyage, he could have partially or wholly written off his tax burden.
So why did this guy refuse the prize two or more years before it would have had any financial impact on him? Why didn't he look into any professional options for writing off the tax? Good question. My guess is either very bad tax advice or sheer lack of courage.
Re:A dream come true? (Score:5, Insightful)
Re:oh BS! (Score:3, Insightful)
Re:About this taxes... (Score:3, Insightful)
Re:Mods: I hope you have someone do your taxes (Score:1, Insightful)
is he pays less than the 25000 in taxes. And how much of the prize actually goes to medical purposes (pre flight
testing, medical checkup etc )Worth to do some research on i guess...
Re:A dream come true? (Score:4, Insightful)
And printed the money that you are paid with, and most importantly, you made and enforced the laws to ensure that the company that you work for will actually pay you for your work, have decent conditions at work including the number of hours and all of that.
Yes, I'm as anti-governemnt as anybody, but I'm more anti-selfish dickhead more, and the government keeps those people and themselves pretty much in check.
Re:A dream come true? (Score:5, Insightful)
Re:A dream come true? (Score:5, Insightful)
Re:A dream come true? (Score:3, Insightful)
No, it doesn't work like that. The post is misleading. If they give you a $138,000 check and then a $25,000 check "to pay the taxes", then the government will just consider your income to be $163,000 and then charge you 18% of that, i.e. $29,000. There's no way around it. The more money they give you the more taxes you will have to pay.
Re:A dream come true? (Score:2, Insightful)
The fundamental problem with your theory is that in the real world, there are always interventionists. It is completely unrealistic to assume that you could somehow eliminate them.
Re:A dream come true? (Score:3, Insightful)
Or is the author not serious? There is no wit, or grace, or amusement value that suggests it is written as a parody.
Re:A dream come true? (Score:1, Insightful)
Re:A dream come true? (Score:1, Insightful)
What are you, 12? When you become an adult, you'll realize what bullshit that is.
Re:Fool... (Score:2, Insightful)
Nowhere in there implies that he's just dying to go to space.
Re:About this taxes... (Score:1, Insightful)
Re:A dream come true? (Score:1, Insightful)
Right. And thats why I buy fire insurance, because I need to burn down my house. Or car insurance, because I need to ram my car into walls at high speeds.
There's a big problem in health insurance, but that isn't it.
reasonably priced catastrophic insurance
Health insurance hasn't been catastrophic insurance for decades, and that's the big problem.