@HankLloydRight
Kindly share with us, TMC forum members, your selling price if you don't mind. I have a referral award set of wheels and tires coming too and would help to know what I can sell them for, if I decide to go that route.
I sold them for $3,750 thought Panjo. They do take a 6.4% cut though. Buyer is paying UPS insured shipping. Just got done wrapping them up for shipping (I included tire totes as well).
Did Tesla really send you a 1099 for the award? If thats the case, then all the Youtubers/high number referrers that are hoping to get a "Free Roadster 2020" have something to think about. If Tesla sends a 1099 for free wheels and tires, one can almost guarantee that they will send a 1099 for $250,000 for the "FREE" roadster. I saw the post Ben Sullins @teslanomics posted on youtube addressing this very issue. It will be interesting to see what happens as the tax liability on an additional income of $250,000 (1099 from roadster) will significantly impact most of them.
Tesla never did send 1099s for the referral prizes received in 2017. In order to do so, they would have needed to request W-9s from all the winners to get their SSNs and info in time to turn around and send 1099s by Jan 31st. I'm not sure what they would have done if you didn't return the W-9s, as the awards are already distributed. They could withhold future awards though.
That doesn't mean you don't have to report them as income or pay taxes on the awards.. the difference is that without a 1099 with whatever value Tesla assigns to the value of the awards, you can assign any market value to the awards when you file your taxes (like what you sold them for). You can adjust 1099s after the fact to Fair Market Value (FMV), but that requires a bit of research and backup documentation for your tax return in case you're audited.
In terms of the Roadster, I'm 99.999% sure Tesla will send out 1099s (in the U.S, I don't know about other countries). Tesla is already doing that for the Powerwall 2 awards, and those awards are worth at least $5500. Yes, anyone winning the "Free" Next Gen Roadster will likely be on the hook for approximately 30% federal income tax (depending on their bracket and marital status) on the total amount of the prize ($250k). But who knows what the tax laws and brackets will be in 2020? Also, there really won't be much opportunity to adjust the FMV of the Founders Edition Next Gen Roadster that will be selling for $250k new. Assuming someone is in the 32% tax bracket already, the federal tax on the Roadster will be around $80,000. Plus any state income tax on top of that. Say the average is 5%. That's another $12,500. So that's (on average) about $92,500 most winners (with state income taxes) will need to cough up on April 15, 2021 just to pay their taxes on the Roadster award. I personally don't want the Roadster (it's a bit too flashy for us in this neighborhood), so I'll sell it and pay the taxes from the proceeds and keep the rest. I already have a buyer lined up.
I'm also pretty sure you can't deduct losses against this kind of income, so if you have huge stock market losses, you can't use those to offset the income tax due on the Roadster.
#firstworldproblems
