We have a Health Foundation who held a fundraiser and the grand prize was a motorcycle valued at $6,900. The prize was donated by the motorcycle dealer. The foundation is awarding the prize to the individual. What are our tax reporting requirements?


Prizes are reportable. While the individual is responsible for listing the prize on her/his income tax, the point of the 1099 is to assist the IRS in identifying under/non-reported income by not relying on the individual alone. The impact on your books is immaterial in this context.

Your organization should issue a 1099 to the winner of the prize. See the IRS Instructions for Form 1099-MISC. We confirmed this with IRS information reporting agent Ms. Walker (ID 1006467).

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