Visualizing Data to Promote Better Public Policy

            FB-icon.jpg Twitter-Icon.jpg G-Icon.png

Income Tax Consequences of Winning the HGTV Dream Home Lake Tahoe 2014

Dec 27, 2013


2014_HGTV_Dream_Home_in_Lake_Tahoe_Colorado.jpg


This year’s HGTV 2014 Dream Home Giveaway is in Lake Tahoe, California. According to the HGTV contest rules, it comes with a home and furnishings valued at $1,760,000, $250,000 in cash, a $77,000 2015 GMC Yukon Denali, and a $2,400 membership at Schaffer's Mill Club--a total value of $2,089,400.


Of course, the $250,000 in cash will come in handy because if you win the dream home, be prepared for a hefty federal and state income tax bill which I have estimated in this post (this analysis excludes the multitude of other taxes such as any deed or transfer taxes and, most especially, the property tax which you pay year, after year, after year . . . well, you get the picture).


Nonetheless, the federal income tax bill alone comes to a whopping $764,040. California is the worst state to locate this contest in because it has the highest income tax rates in the country with a top rate of 12.3 percent. As such, you will owe the state of California another $229,234 in income taxes. If you plan on keeping this home, best be prepared to take on a second job or take out a home-equity loan to pay Uncle Sam and California. The $250,000 in cash barely covers California's tax take.


Fortunately, HGTV does provide an escape hatch by offering $1,050,000 in cash in lieu of taking possession of the home. You also get to keep the $250,000 in cash and the $77,000 Denali for a total escape pot of $1,377,000. If the winner opts for this choice, they will take home $753,462 free-and-clear after paying federal and state income taxes of $623,538. These numbers kind of makes you wonder who the real winner of this contest is--the contestant or the government?


My suggestion would be take this money and run. One could outright buy a very, very nice home with the cash and have zero debt. If you have had your fill of paying taxes, you could buy a house in the handful of America’s tax havens left (all in New Hampshire) where there are no state and local individual income taxes, no state or local sales taxes and very low (in some case no) local property taxes.


Or, if New Hampshire is not your style, you can check out the tax burdens in other states with our unique tax burden app which shows tax burdens by state, by type and over time. Also, the contest for the 2014 diy Lakeside Blog Cabin will be announced soon and I will estimate the tax bill of winning that home as well . . . stay tuned. For those who might be interested, here is what California's tax burden looks like.


California_Tax_Burden_1950_to_2011.jpg

 



Category: Tax Burdens

J. Scott Moody

J. Scott Moody has over 17 years as a public policy economist with a specialty in tax policy and has over 170 publications. He has worked for numerous national and state-based think tanks such as State Budget Solutions, Tax Foundation, Heritage Foundation, and The Maine Heritage Policy Center.


 


 

Click Here to Calculate
Your Income Tax!

 



Check Out Our Unique Apps:

Government Workforce App

Tax Burden App

Cost of Living App

Federal Taxes and Cost of Living App

Check Out All Posts For Your State:

Alabama

Alaska

Arizona

Arkansas

California

Colorado

Connecticut

Delaware

Florida

Georgia

Hawaii

Idaho

Illinois

Indiana

Iowa

Kansas

Kentucky

Louisiana

Maine

Maryland

Massachusetts

Michigan

Minnesota

Mississippi

Missouri

Montana

Nebraska

Nevada

New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

Rhode Island

South Carolina

South Dakota

Tennessee

Texas

Utah

Vermont

Virginia

Washington

West Virginia

Wisconsin

Wyoming

Category List


Tag List

General Assistance (1)
North Dakota (4)
2014 Blog Cabin (1)
Dr. Arthur Woolf (1)
Oklahoma (2)
Bankruptcy (1)
Unincorporated Business Tax (1)
Federal Budget Deficit (2)
Government Compensation (48)
Business Taxes (1)
Oregon (2)
Joe The Economist (1)
State Business Taxes (1)
Property Taxes (1)
West Virginia (2)
Tax Havens (1)
Tennessee (2)
Illinois Policy Institute (1)
Georgia (4)
Severance Taxes (4)
Local Individual Income Tax (1)
Property Tax (3)
Hawaii (3)
Alaska (4)
Maryland (2)
Schaffer's Mill (1)
Internal Revenue Service (1)
Healthcare (1)
Interest Rates (2)
Individual Income Tax Cuts (1)
Kentucky (2)
New York (3)
Census Bureau (2)
Pennsylvania (2)
Progressive Individual Income Tax (1)
Government Workforce (51)
Act 60 (1)
Federal Interest Payments (2)
Massachusetts (2)
Illinois (3)
Winter Haven Florida (1)
Arizona (2)
Wyoming (3)
Ohio (5)
COST (1)
Mississippi (2)
Tax Cuts (1)
Indiana (3)
Student Loans (1)
Hydraulic Fracturing (2)
2013 Migration Patterns (1)
Manhattan Institute for Public Policy Research (1)
Proposition 2 1/2 (1)
Nevada (2)
Sales Tax (1)
Tax Foundation (13)
Kansas (2)
Michigan (2)
Montana (2)
Lake Tahoe California (1)
South Dakota (2)
New Mexico (2)
IRS (1)
Income Tax (1)
Fix SS Now (1)
Plausible Baseline (1)
Tax Exporting (4)
Sales Tax Pyramiding (1)
Social Security Reform (1)
Tax Burdens (53)
Maine (3)
Tax Collections (1)
2014 HGTV Dream Home (1)
diy network (2)
RealEstateConsulting.com (1)
Business Enterprise Tax (1)
Louisiana (2)
Vermont (3)
John Mauldin (1)
Atlas Van Lines (1)
Idaho (2)
Oklahoma Council of Public Affairs (1)
Government Employment (48)
Rhode Island (2)
Insurance Premiums (1)
Employment (1)
Obamacare (1)
Hoover Institution (1)
Council on State Taxation (1)
HGTV 2014 Dream Home (1)
Federal Income Tax Burden (3)
Government Wages and Salaries (48)
Marginal Tax Rates (1)
Coal Severance Tax Trust Fund (1)
HGTV 2014 Urban Oasis (1)
Veronique de Rugy (1)
Ali Wolf (1)
Texas (3)
Washington (2)
Virginia (2)
TANF (1)
Delaware (2)
Transparent Nevada (1)
Municipal Individual Income Tax (1)
California Income Tax Burden (1)
Taxes Matter (2)
Washington, D.C. (1)
New Hampshire (4)
Business Flat Tax (1)
Missouri (2)
Congressional Budget Office (1)
Social Security (1)
Connecticut (3)
Migration (2)
Minnesota (2)
Buckeye Institute (1)
U.S. Census Bureau (2)
Florida (3)
New Jersey (2)
HGTV 2014 Smart Home (1)
Alvin Rabushka (1)
Government Benefits (49)
Proposition 13 (2)
Individual Income Tax Calculator (2)
Wisconsin (2)
Fiscal Cliff (2)
Rick Palacios Jr. (1)
North Carolina (3)
Aid to Families with Dependent Children (1)
Iowa (2)
AFDC (1)
Colorado (2)
Know Your Rates (1)
Individual Income Tax Burden (3)
John Burns (1)
Utah (2)
Federal Debt (2)
Welfare Reform (1)
Wyoming Taxpayers Association (1)
Cross-Border Shopping (3)
Free-Stater (2)
Concord Coalition (1)
Gordon Tullock (1)
diy 2014 Blog Cabin (2)
Jock Tax (1)
Federal Income Tax Liability (2)
ALEC (1)
Permanent Wyoming Mineral Trust Fund (1)
Severance Tax Permanent Fund (1)
Tax Reform (2)
James Buchanan (1)
California (6)
Tax-Rates.com (1)
Johnny Manziel (1)
Local Business Taxes (1)
Law of Unintended Consequences (1)
Public Choice Economics (1)
South Carolina (2)
Nebraska (2)
Public Assistance (1)
Alaska Policy Forum (1)
Flat Tax (1)
Mercatus Center (1)
Arkansas (2)
Robert Hall (1)
Local Option Sales Tax (1)
Daniel DiSalvo (1)
Gross Receipts Tax (3)
Alabama (2)
Manufacturing (1)
Temporary Assistance for Needy Families (1)

Tag Cloud

HawaiiWyomingRobert HallManhattan Institute for Public Policy ResearchIndianaMississippiMassachusettsLouisianaSchaffer's MillRick Palacios Jr.MichiganFloridaJohn MauldinNew YorkMunicipal Individual Income TaxMarginal Tax RatesHealthcareTax CutsLocal Business TaxesAtlas Van LinesFree-StaterIdahoInternal Revenue ServiceMarylandOregonProposition 13Business TaxesFederal Budget DeficitIndividual Income Tax CutsPlausible BaselineDaniel DiSalvoJock TaxCaliforniaPublic AssistanceIndividual Income Tax CalculatorJames BuchananSales Taxdiy 2014 Blog CabinNew MexicoMontanaRealEstateConsulting.comSouth CarolinaConnecticutHydraulic FracturingAlaska Policy ForumBusiness Enterprise TaxWest VirginiaStudent Loans2014 HGTV Dream HomeFederal Interest PaymentsInterest RatesFederal DebtHGTV 2014 Dream HomeTennesseeVirginiaCalifornia Income Tax BurdenTax BurdensTexasBuckeye InstituteNew JerseyTax-Rates.comSocial Security ReformLocal Individual Income TaxNorth CarolinaSocial SecurityBusiness Flat TaxArizona2014 Blog CabinCOSTPennsylvaniaIllinoisCensus BureauNorth DakotaTaxes Matterdiy networkColoradoTax ExportingInsurance PremiumsAFDCConcord CoalitionIncome TaxCongressional Budget OfficeWelfare ReformTemporary Assistance for Needy FamiliesWisconsinKnow Your RatesDelawareGovernment EmploymentAlaskaGovernment Wages and SalariesFederal Income Tax LiabilityProperty TaxesTANFDr. Arthur WoolfJohn BurnsSouth DakotaWashington, D.C.Act 60EmploymentMaineFederal Income Tax BurdenFlat TaxIowaRhode IslandLocal Option Sales Tax2013 Migration PatternsTax CollectionsManufacturingLaw of Unintended ConsequencesNebraskaNevadaHGTV 2014 Smart HomeMigrationArkansasBankruptcyMinnesotaObamacareLake Tahoe CaliforniaFiscal CliffGross Receipts TaxIRSUtahGeorgiaState Business TaxesOklahomaPermanent Wyoming Mineral Trust FundCoal Severance Tax Trust FundU.S. Census BureauIllinois Policy InstituteNew HampshirePublic Choice EconomicsCouncil on State TaxationTransparent NevadaAlabamaWashingtonJohnny ManzielSales Tax PyramidingWyoming Taxpayers AssociationHoover InstitutionGovernment CompensationUnincorporated Business TaxTax FoundationKentuckyWinter Haven FloridaALECMissouriGovernment WorkforceGordon TullockProgressive Individual Income TaxAli WolfIndividual Income Tax BurdenGeneral AssistanceOhioKansasOklahoma Council of Public AffairsVeronique de RugyHGTV 2014 Urban OasisGovernment BenefitsTax HavensProperty TaxTax ReformVermontCross-Border ShoppingAid to Families with Dependent ChildrenMercatus CenterSeverance Tax Permanent FundJoe The EconomistAlvin RabushkaProposition 2 1/2Severance TaxesFix SS Now


Archive

C O N T A C T   U S  -  C L I C K   H E R E