Hal Gore won a $2.1 million prize for special contributions to environmental research. This prize is awarded for public achievement, and Hal directed the awarding organization to transfer $570,000 of the award to the Environmental Protection Agency. How much of the prize should Hal include in his gross income?

Question

Business

Diana Hebert

28 February, 10:42

Hal Gore won a $2.1 million prize for special contributions to environmental research. This prize is awarded for public achievement, and Hal directed the awarding organization to transfer $570,000 of the award to the Environmental Protection Agency. How much of the prize should Hal include in his gross income?

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Answers (1)

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Pablo Acevedo · Answer 1

1.53 Million

Explanation:

The reason is that the Environment Protection Agency is a qualified organization and donations made to qualified organization are allowable expense under the US tax rules, so the gross income will include a net amount which is the actual amount left for Hal Gore and which is $1.53 million ($2.1 m - 0.57).