Hal Gore won a $1.75 million prize for special contributions to environmental research. This prize is awarded for public achievement, and Hal directed the awarding organization to transfer $605,000 of the award to the Environmental Protection Agency. How much of the prize should Hal include in his gross income?

Question

Quizplus · Accepted Answer

Hal should include the entire prize of $1.75 million in his gross income, but he directed $605,000 of the award to the Environmental Protection Agency, which will be considered a charitable contribution and may be deductible as an itemized deduction on his tax return. The remaining $1,145,000 would be included in his gross income.

Hal Gore Won a $1