What Information Does a 1099-MISC Contain?The 1099-MISC will include information that helps the IRS and you report your sweepstakes income. This information includes:
- The sponsor's, name, address, and tax ID number.
- The value of the prize.
- Your name, address, and social security number.
- The tax year that the 1099 form applies to.
- Any other relevant information.
When Will Sweepstakes 1099 Forms Arrive?According to the IRS 1099-MISC Guidelines, sweepstakes sponsors must mail a copy of the 1099-MISC form which must be postmarked by January 31st of the year following the year in which you won the prize. For example, if you won a prize in May of 2013, your 1099 should be mailed by January 31st of 2014, though it can be mailed earlier. It can take a week or so after the end of January to receive the tax form in the mail.
The 1099 will be sent for the year in which you receive a prize, not the year in which you win a prize. So if you win a car in 2008 but take possession of it in 2009, you can expect to get the 1099 by early February, 2010. If the sponsor sends the 1099 early, you can dispute it with them.
What Happens If I Don't Receive a 1099 Form for My Win?The IRS has the following to say about what to do if you do not receive a 1099 from the sponsor:
If you have not received an expected Form 1099 by a few days after that, contact the payer. If you still do not receive the form by February 15th, call the IRS for assistance at 800-829-1040. (From the IRS document, Missing a 1099?)
What Happens If My 1099 Form Shows the Wrong Prize Value?Remember that you only have to pay sweepstakes taxes on the fair market value of your prize. This can vary from the value that the sweepstakes sponsors estimated when they offered the prize. For example, if it takes you a while to receive the prize, the item might be selling for far less than it was when the sweepstakes' rules were drafted. If you feel that the prize value on your 1099 form is too high, you should read How to Dispute an ARV on Your Sweepstakes Taxes.
Do I Need to Send My 1099 to the IRS?No, the IRS will receive a copy of the form from the sweepstakes sponsor. You only need to enter the prize value into your miscellaneous income and keep the 1099 for your records as proof of your sweepstakes income.
This is intended to be a general overview of how sweepstakes taxes work in the United States. Tax laws change frequently, and the most recent information can be found on the IRS website. I am not a tax professional, and this article is not intended to be legal advice. Your situation may be different, and you should always consult with a knowledgeable professional if you are unsure about anything to do with your sweepstakes taxes.