An Aylmer Ontario couple has come up with a unique way to sell their house, and as an author as well as a realtor, I have to say the idea appeals to me . They’re inviting people to submit essays and $ 100. If they get 3,000 entries, the winning essayist gets the house. If they don’t, the money will be returned. (Love that this couple says they’re not sticklers about grammar: “we don’t care about commas.”)
As you can see from this article, there are some strict legal provisions that go along with this kind of thing. It has to be skill-based and not a random draw, for example. That’s because lotteries are strictly regulated under the Criminal Code of Canada; not just anyone can hold one. Good for the sellers for making sure they protected themselves legally.
The question I have is whether the lucky “buyer” would have to declare their “prize” winnings (i.e. the value of the house) as taxable income. Usually writers (and others) who win contests that are skill-based have to pay income tax on the cash prices they receive; I would guess that applies to cash-in-kind prizes, too.
(A random draw, or lottery, by contrast, is income-tax free.) But I can’t give legal advice anymore, and that may not be the case, so the lucky buyer would have to run that one by a lawyer who is familiar with the law in this area to find out for sure. And maybe their accountant as well.
It would be a good idea for the successful buyer, er, writer, to make sure the agreement for sale has appropriate conditions protecting against any unhappy surprises on that front. After all, there is an old saying that things that seem too good to be true may not be.