Bruce wilson won 3 million in the state lottery the lottery

Reference no: EM13576066

Bruce Wilson won $3 million in the state lottery. The lottery pays out the prize money in 20 annual installments of $150,000 each. After receiving three $150,000 installments, Bruce sold the remaining $2.550 million of payments for $1.5 million, reported the $1.5 million as long-term capital gain on his tax return, and paid tax on that amount at the 20% tax rate (long-term capital gain rate). Bruce's tax return has been selected for audit by the IRS. Is he likely to prevail on his treatment of the $1.5 million sale of his future lottery payments as a long-term capital gain?

Reference no: EM13576066

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