Problem
Ted won a car worth $47,000 on the TV game show The Price is Right in November of the current year. He is debating selling the car next year because although he really needs a new car, the car he won is much nicer and more expensive than what he would have purchased himself. How much income does Ted recognize in the current. year? Why is this potentially problematic?
In contrast, on March 13, Jason won the Powerball jackpot lottery (Luc-kyI). Jason will receive 30 annual payments of $13.3 million. He received the first payment of $13.3 million on July 1 of the current year. How much gross income does Jason have in the current year as a result of the Powerball winnings? Why is this less problematic than Ted's situation?