What happens when you win a car giveaway

Winning a car giveaway starts with a phone call or an email and ends with you signing for the keys. In between, you'll sign an affidavit, hand over tax details, line up insurance and sort out who pays to get the car home. Here's the sequence, with deadlines and requirements taken from the official rules of the 77 live giveaways we track.

The first hour after the call

The news is exciting, and the clock is already running. Do these things before anything else.

1. Confirm it's real. Match the caller or sender to the sponsor or administrator named in the official rules. If you're unsure, hang up and call back on a number from the rules or the sponsor's own website.
2. Reread the rules. Find the response deadline, the documents you'll need, the delivery terms and whether there's a cash option. Save a copy of the rules as they stand today.
3. Gather your documents. Driver's license, insurance details and your Social Security number for the W-9. Clear scans or phone photos make the paperwork faster.
4. Ask before you post. Check with the sponsor before you announce it. Until verification clears, you're a potential winner, not the winner.
5. Keep copies of everything you sign, along with the emails and any tracking numbers.

Step 1: The notification

After the drawing, the sponsor or its administrator contacts you using the details from your entry. 69 of 77 live giveaways list email as a contact method, 59 list phone and 43 list mail. 6 draw or announce the winner on a livestream, so you might find out with an audience watching.

At this point you're a “potential winner.” The prize isn't yours until you respond in time and clear verification, and many rules give you very little time. 31 of the 77 live giveaways state a response deadline. The shortest is 24 hours, the median is 5 days, and 10 give you three days or less.

During drawing week, pick up calls from numbers you don't know and check your spam folder. Enter with an email address and phone number you actually watch. 35 of the live giveaways spell out that the prize passes to an alternate if the first winner can't be reached or doesn't qualify.

One warning: real notifications don't arrive as a direct message from a look-alike account, and they never ask for a fee. Our guide to car giveaway scams shows how to tell the difference.

Step 2: The verification paperwork

Next comes a packet of documents to sign and return. Every live giveaway requires the affidavit; the rest depends on the sponsor.

The return deadline is tight. Where the rules give one for the affidavit, it runs from 3 to 7 days after you're notified. If the rules call for a notary, find one before the packet arrives. And read the publicity release before you sign, since it sets how the sponsor can use your name, photo and video.

Step 3: Taxes

A car is taxable income. The IRS says prizes count as income, and when the prize is property rather than cash you report its fair market value. The sponsor reports the prize to the IRS on Form 1099-MISC and has to send you a copy by January 31 of the following year. That's what the W-9 is for.

The hard part is that you owe tax on a car without receiving any cash to pay it. Some sponsors help: 15 live giveaways put a cash amount toward the winner's taxes (median $36,000), and 46 offer a cash alternative instead of the vehicle. What you never do is pay tax to the sponsor or anyone claiming to represent it. The postal inspectors are clear that you pay taxes only to the IRS.

If the rules give you a choice between the car and cash, expect to decide around the time the paperwork is due. Our guide to taking the car or the cash compares the two after tax. For the tax bill itself, read our guide to taxes on winning a car or run your prize through the car giveaway tax calculator.

Step 4: Pickup or delivery

How the car reaches you is set in the rules, and it varies a lot. Of the 77 live giveaways, 25 require you to collect the vehicle, 30 allow pickup or delivery, 4 deliver it, and 18 don't say. 22 say the sponsor pays for your travel or the delivery.

Collection has a deadline too. Rules that set one give you between 7 and 30 days to take the vehicle, after which it can be forfeited. 33 live giveaways list a valid driver's license as an eligibility requirement, and 18 mention the vehicle being awarded as-is. Inspect it before you sign for it, and photograph any damage.

Step 5: Title, registration and insurance

Once the car is yours, you register it in your state like any other vehicle. The fees are usually yours: 62 of the 77 live giveaways' rules mention title, registration or license costs falling on the winner, and 8 mention sales tax. 5 set a deadline of 10 days to transfer the title into your name. Ask your DMV before pickup what paperwork it needs from the sponsor and whether your state charges sales or use tax on a prize vehicle.

Line up insurance first. Almost every state requires liability coverage to drive (New Hampshire is the notable exception), and 50 of the live giveaways want proof of insurance before they hand over the car. Call your insurer as soon as you have the year, make, model and VIN.

How long it all takes

1. Drawing. 68 of the 77 live giveaways set the drawing “on or about” a date, so it can slip a day or two.
2. Notification and response. A median of 5 days to answer, where the rules say.
3. Paperwork. Affidavits due within 3 to 7 days, where stated. Then the administrator checks your documents against the rules.
4. Handover. Pickup or delivery, with 7 to 30 days to collect where the rules set a limit.
5. Taxes. Your Form 1099-MISC arrives by January 31 of the following year, and the prize goes on your return for the year you received it.

What can cost you the prize

• Missing the response window or the affidavit deadline.
• Failing eligibility. Age, state of residence and prior wins all count: 9 live giveaways bar people who won a prize recently.
• Not having a valid license or insurance when the rules require them.
• An entry that broke the rules. A mail-in with the wrong card or a typed address can be voided even after it's drawn, so follow our mail-in guide to the letter.
• Not collecting the vehicle before the deadline.

None of this should put you off entering. It's a reason to read the notification and prize sections of the rules before you enter, while there's no clock running. Every listing in our live giveaways directory shows the response window, delivery terms and winner requirements from its rules, and our winners page shows who has won and where each sponsor announced it.