Prize Taxes

What is the name of your state?
Florida

I recently won a “Free rent for a year” prize from an apartment developer. It is basically a free apartment paid for by the company for around $700 a month. I do not actually receive anything but a place to live. My question is if I will have to pay any taxes on this prize? When I asked them this all I was told is I would receive a W-4. The total dollar amount will be around $8400. PLEASE HELP!!! Thanks,

Jeff

[abezon]

Yes you will pay taxes. Income is defined as anything of value you receive that's not specifically excluded by law AND any abatement of expenses you would otherwise have to pay. You'd normally have to pay rent, so free rent is income. Take the $700 you'd normally be paying for rent and save at least $150/month to cover taxes. (That number assumes you are in the 15% bracket.) While you're at it, save the entire $700 and you're a long way towards buying your own house/condo using gov't first-time buyer programs.