Why does the government treat sweepstakes as income rather than gifts?

Question

Like charge a gift tax instead of an income tax. For example. Jon won a Vacation worth 5,000 dollars to Hawaii. Now Jon is makes about 12,000 a year According to the government. His income would be 17,000 dollars. That's not true.

Update:

I met sweepstakes not lottery.

Answer 1

Favorite Answer

You should ask this question in the Tax section. This is the Gambling section. Those tax freaks would do a better job with this.

Answer 2

B/c the value of the prize IS income to them, not a gift. They recieved something of value they did not have before.

Answer 3

Government doesn't treat the lottery like that. People can still qualify for welfare even though they won the lotto