Can teenagers be taxed on items or cash won from sweepstakes?
From your information, you are a dependent.
It is possible to be taxed on sweepstakes winnings. The value of your prizes is considered "other income." If your total winnings are greater than $950, you are required to file a tax return and will owe income tax (but not Social Security or Medicare Tax). If you win prizes with value less than $950, you will not need to file a tax return and will not owe tax.
In many cases, when a child is awarded a prize (especially something of significant value), the prize is considered awarded to the parent. Read the rules for your sweepstakes to find out. Your parents are subject to different rules, but if you win a prize and the award is considered to be awarded to your parents, your parents will include the value of your prize on their tax return.
A small prize with advertising information on it will not be considered to have any value for tax purposes (e.g. something with small value such as a t-shirt with advertising logo).
I am holding a sweepstakes online and i have a legal question can you help?
No, that is still illegal. Anything in which a person can pay money to buy a chance to win is a sweepstakes or lottery and that is illegal. Even if you are giving a free entry, the allowance of additional entries for money is against the law.
How do I have to report sweepstakes income if I sell the prize?
You have to report the fair market value of the prize in the year you won the prize. As long as you sell the prize for less than what you claimed it was worth when you won it, then there are no more additional taxes. If you sell it for more than $9000, then the difference is a captial gain.
How would I conduct a legal sweepstakes for my small business in Texas?
Are you currently advertisting? If you do, then include the submission form with your ad. The reason is the person who got the sweepstake might already have a counter top, so your gift might not be usable to them, unless it has cash value which I don't recommand.
If you include submission in the ads, then you can collect customer information, to send them direct mail later on. Think about it. Try valpak, merchandiser or clipper magazine, there are ones who have lots home improvement ads inside.