Your client, John Jackson, is an avid Boston Red Sox fan. Last April at the Red Sox first game, as a result of a random drawing of those in attendance at the game, John won 300 Dunk My DoNut coupons. Each coupon entitled him to a cup of coffee and a free doughnut or a dozen doughnut holes. John used some of the coupons (approximately 33), but he found that eating so many doughnuts directly conflicted with his goal of losing weight. The unused coupons expired on December 31, 2017. Thus, John was surprised when he received a Form 1099 in January 2018 that valued his prize at $1,100.John would like to know whether the value of the doughnut coupons should be included in income and asks you to research his question. If you conclude that their value should be included in income, John also would like to know if he can reduce his gross income by including in income only the value of the coupons that he used.