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natita [175]
3 years ago
5

On February 2019, Melinda applies and nominates herself for the prestigious North American Literary Prize. In June 2019, she win

s the prize for her academic and literary works. The award comes with a $1,000,000 cash prize that Melinda then donates to the City of Denver. Melinda is not required to take any action after receiving the cash prize. Is Melinda required to include the cash award in Gross Income?
Law
1 answer:
spin [16.1K]3 years ago
3 0

Answer:

Melinda is required to include the cash prize in the Gross Income.

Explanation:

Gross Income is the total payment in cash, goods and services that a person received before tax reductions, that is, it is the general value of everything that a person received in a given period of time, including wages, premiums, real estate, among other things . In this case, we can confirm that the cash prize received by Melinda must be included in her Gross Income, in addition, if she has received a prize with an economic value, she must also include this prize in the Gross Income, even if she has donated .

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