Unknown Income Tax Possibilities

Very few of the public know much about the tax consequences of much of the financially-oriented news they see or hear. Some examples:

That foreclosed mortgages and any reductions in credit card loans and other loan forgiveness, result in an income tax bite. Amounts saved are considered income.

Prize money won in a TV contest by a lucky contestant is taxable as income.

And that free vacation trip or new car gift is probably going to be taxed at the retail value, not at the discount you could have gotten, had you bought it directly.

So, the contestants may be getting non-cash items for cash outlays they may not even possess.