Minors & Gambling winnings?

[SG4]

So it's almost year end & the burden of filing W-2G's is almost upon the luckiest of us who have taxable tickets from the year, so the tax time thoughts were definitely in my head when I heard a snippet on the radio yesterday which caught my attention. It was at the end of a lottery commercial on the radio, where they said something to the effect of "please think twice about gifting lottery tickets to minors."

So this made me stop in my tracks, as I never thought giving a lottery ticket to a minor could be legal, but I guess the law is just you need to be 18 years old to purchase. I guess rules differ by state, but it does appear to me that a minor can then cash a lottery ticket as long as they're accompanied by a guardian.

This leads to my question, which is can a person gift a parimutuel ticket to a minor? I know for certain clerks will cash a winning ticket given to them by a minor (maybe that's not technically legal), but is there any protocol for an IRS ticket if a minor presents it?

My thought here is, if you're an adult with children (who have no income), and you scratch off a lottery ticket for say $10,000 wouldn't you reduce your tax burden a whole bunch if you let your child claim it was their ticket? Wondering if I should be planning on stocking stuffing a bunch of pick 5 tickets this coming holiday season.

[rrpic6]

Zero chance on any OTB, racino or racetrack lets a minor cash a "signer". Once a Driver's License is provided and the Mutuel Teller checks the person's birthday, the transaction stops if the person is not of legal age. No way would they take a chance of paying a minor, then being held responsible when the paperwork is passed up the chain of command. The fines are enormous for the companies involved if minors are caught gambling illegally on anything.

RR

[upthecreek]

Found this Waiting to hear from NJ Lotto

But the law does not prohibited someone under 18 from claiming a prize. There are some caveats, though: If the person under 18 and the prize is less than $5,000, the commission can give the money to an adult family member, or to the minor’s guardian.
If the prize money exceeds $5,000, though, the commission will make payment to the adult member's bank, and then the child's custodian would have to sort out who gets the money under New York estate law.

[KennyG1]

there is a rule that if a kid makes more than $2100 in unearned income, defined as anything that's not payment for personal services performed, the income will be taxed at the parent's tax rate.

https://www.irs.gov/taxtopics/tc553.html

[upthecreek]

A person under the age of 18 years old cannot cash a winning mutuel ticket.

Sincerely,

New Jersey Racing Commission

[AndyC]

You can gift a winning ticket to a minor but the income cannot be transferred for tax purposes. Once the ticket becomes a winner, the holder is liable for the taxes. A gift prior to the outcome of the event will transfer any potential tax liability along with the gift.

[Robert Fischer]

how about a game of 'musical chairs' ?

[SG4]

Thanks all for the input, back to the loophole drawing board.