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Astros fan learns there’s no such thing as 315 free donuts

Discussion in 'Houston Astros' started by Rockets Pride, Apr 18, 2011.

  1. Rockets Pride

    Rockets Pride Member

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    Everyone knows you're going to get hit with a hefty tax bill when you go on "The Price Is Right" and win a Corvette, a living room set and a trip to Aruba in the Showcase Showdown.

    Same goes for the cash you take home after playing hangman with Pat Sajak and Vanna White on "Wheel of Fortune."

    But getting issued a 1099 form and taking a $237 tax hit after winning over 300 coupons for free donuts and coffee on fan appreciation day at a Houston Astros game?

    Well, that's about as unpleasant of a surprise as tasting a chocolate creme filling when you were expecting Bavarian:

    Yet that — and presumably thousands of empty hidden calories — were the hidden costs for Bob Choate. As the Houston Chronicle reports, the Astros fan thought he had hit a jelly-filled jackpot when he won 315 coupons for a free coffee and doughnut at Shipley Do-Nuts last season. But the prize was estimated by the team and chain to be worth $927.61 — or about $3 a coupon. And that led to them requiring a 1099 tax form to be issue because it was above the $600 threshold.

    Choate thought the doughnuts and coffee were not worth that much — presumably because there's no way anyone could ever cash in 315 coupons and live to tell about it — and said so. After getting no relief from the Astros, doughnut baron Lawrence Shipley agreed to cover the tax on his goods.

    From the Houston Chronicle:

    Choate said he's made the exchange with the Astros and Shipley a lesson for his kids.

    "I told them that if you think something isn't the way it should be, speak up and be professional and reasonable and diplomatic," he said. "And, if you're on the other side of the table, you should listen."

    But before you start thinking that Choate is a chronic complainer who's only looking for a free ride — or 26 free dozen doughnuts — know this: He was so impressed by the doughnut chain's gesture that he says he's going to donate $237 to Shipley's favorite charity. I'll dunk a cruller to that.

    http://sports.yahoo.com/mlb/blog/bi...-there-8217-s-no-such-thing-as?urn=mlb-wp3695
     
  2. Qball

    Qball Contributing Member

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    To make it worse, I bet the coupons "worth" $3 a pop have fuzzy lil words at font size 2 stating "Coupon is worth 1/100 of a cent".

    Poor guy.
     
  3. weslinder

    weslinder Contributing Member

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    I know a man named Bob Choate, who would fight a tax like this, and checked the article to see if it was him. Alas, it's not.
     
  4. TheChosenOne

    TheChosenOne Contributing Member

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    $3/a pop my ass.
     
  5. msn

    msn Member

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    wait you're offering people to do *what* for just $3??
     
  6. DonnyMost

    DonnyMost not wrong
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    It's really stupid that stuff you win out of random chance, especially material goods, is considered taxable income.
     
  7. JJ

    JJ Member

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    Ha, Ha! I read it and thought the same thing.
     
  8. wekko368

    wekko368 Member

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    http://money.msn.com/taxes/article.aspx?post=99338a48-c41a-401f-8727-c99262384eab&GT1=33029
     
  9. DieHard Rocket

    DieHard Rocket Contributing Member

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  10. Cannonball

    Cannonball Contributing Member

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  11. DonnyMost

    DonnyMost not wrong
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  12. david_rocket

    david_rocket Member

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    or what about if tinywang started the thread, it would be "tinywang" at Clutchfans. but "Master Baiter" would be very funny HAHA

    and why she didnt look for the original source? (the yahoo article)
    a writer should look for the original source instead something on a messageboard
     
  13. TexasFight

    TexasFight Member

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    What doesn't make sense to me is that Lawrence Shipley's agreement to pay the tax bill of $237 counts as taxable income for Bob Choate... and he should have to pay tax on that amount as well...

    Its not like Shipley is filing his 1040 on Choate's behalf... Choate still has to pay the $237 in addition to any other tax he owes - so Shipley has to "gift" the money to Choate - and gifts count as taxable income.

    I've never understood how they get around the tax situation when things like this happen and someone "generously offers" to "cover the taxes" for a prize... the receiver has to pay tax on the offer too.
     
  14. Cannonball

    Cannonball Contributing Member

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    I don't know about this situation, but I've seen cash included with prizes that would cover the taxes on the entire prize package, including the cash.
     
  15. TexasFight

    TexasFight Member

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    See, now THAT makes sense... include enough cash in the original package to pay the tax for the prizes AND the cash... but I feel like that never happens.

    unless maybe the person offering to cover the tax always gives additional cash to cover the original tax as well as the tax on the cash given? i guess that might be the answer here.
     
  16. Rockets Pride

    Rockets Pride Member

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    I AM THE SMARTEST MAN ALIVE!!!!!!!!!!!!!!!!!!!!!
     

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