Las Vegas - Won a trip

Well I wish it was me, but it was actually a friend. In a contest in which you just needed to answer some questions, my friend won and the big prize was 4 tickets 2 adults and two minors, 6 nights at the TI plus a helicopter tour to the GC. My friend was asking me what could he do with the nights at the hotel because he prefer to pay to stay in another place. So would you recommend him to stay at the TI or pay for another hotel. What could he do with the TI nights if he stays in another hotel

If it is transferable, he could take out an ad for it on Craig's List, Ebay or something like that. He could use the money to pay the tax on the prize.
Or he could just take a couple more people and check in with his name, than go to the alternate hotel and check in again.
Key here is 1099 for income tax. He may be in for a very unpleasant surprise.

Since he's going to get taxed like hell for the prize package, I would suggest that he find out if he can decline the hotel part of the package and save him some tax $$. Otherwise, I'd just stay there.

Since he's going to get taxed like hell for the prize package, I would suggest that he find out if he can decline the hotel part of the package and save him some tax $$. Otherwise, I'd just stay there.
Why would he be taxed like hell.isn't he supposed to pay the tax that he would actually pay. Are you saying that he will get to pay more than he is supposed??

Why would he be taxed like hell.isn't he supposed to pay the tax that he would actually pay. Are you saying that he will get to pay more than he is supposed??

The company that issues the prize will value the winnings at TOP dollar. It is a common practice. This value will be on the 1099 that is issued to your friend. It will probably be twice what he would have paid if he shopped around. It is very frustrating for contest winners--the stories are all over the place.
Of course, he can contest it with the IRS. Good luck with that.:(

Why would he be taxed like hell.isn't he supposed to pay the tax that he would actually pay. Are you saying that he will get to pay more than he is supposed??

The sponsor will send a 1099 for the ARV (Approximate Retail Value) of the prize, that he will have to claim as income. The ARV is likely to consist of the full Y airfare, and the rack rate at the hotel.

He'll need to have some documentation that he could have purchased the package for less money in order to dispute the amount and only pay income tax on the FMV (fair market value).

http://contests.about.com/od/taxesfinances/ht/sweepstakestax.htm

Whether he uses the TI Rooms or not, he's going to pay income tax for their value. Same with the plane tickets. Even if only two people end up going, its my understanding he'll pay income tax for the value of the 4 tickets unless he is able to actually decline that part of the prize.

I wad seeing the website you gave me and Iforgot to say that the contest is in Mexico, but I guess he will still pay tons of taxes

Why would he be taxed like hell.isn't he supposed to pay the tax that he would actually pay. Are you saying that he will get to pay more than he is supposed??

A won prize is considered income. You're taxed on it the same as any other income.