A question regarding the "one lump sum" prize option for Powerball in the state of North Carolina.=)Prev Topic Next Topic

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Power-Balls

Wilmington, NC
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Mar 30, 2009, 8:26 am

If you win the Powerball Lottery in the state of North Carolina, and choose to take the cash option (one "lump sum") as your prize, how much taxes (Federal and NC State - percentage wise) do they take out of your winnings?

Thanks,

~Power Balls

(PS- Not sure which section this post belongs in. So I put it in both. )
libra

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Cleveland , Ohio
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Mar 30, 2009, 8:47 am

On the left side of this page you will see an icon for USA Mega. Click on it. When it opens go to the left side of that page scroll down and you will find Power ball. Then look for JACKPOT Analysis. Click on it. North Carolina State tax is 7%.

Libra Dave
Power-Balls

Wilmington, NC
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Mar 30, 2009, 8:56 am

Ok, thanks!

Now, do you know how much they withhold for federal taxes?

It mentioned a flat 30%, but that sounds really high. Is that just for non-US citizens? And if so, how much is the federal tax rate for the Powerball winnings for US citizens?
libra

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Cleveland , Ohio
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Mar 30, 2009, 9:00 am

If you look at the top of the Jackpot Analysis page it says that the Federal Tax is 25%.

Libra Dave
Power-Balls

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Mar 30, 2009, 9:06 am

Ok, thanks again!

It sounds kinda high (25% tax), but I guess with the amount of money received, it would have to be that high... *sigh*
libra

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Cleveland , Ohio
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Mar 30, 2009, 9:25 am

To get a ballpark figure after State and Federal taxs , Take the lump sum and divide it by 3, then multiply the answer by 2. It's usually pretty close.

Libra Dave
Todd

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Chief Bottle Washer

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Mar 30, 2009, 9:25 am

<Moved to Jackpot Games forum>
Please post in the appropriate forum ... thank you.
Todd

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Chief Bottle Washer

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Mar 30, 2009, 9:26 am

Quote: Originally posted by Power-Balls on Mar 30, 2009
If you win the Powerball Lottery in the state of North Carolina, and choose to take the cash option (one "lump sum") as your prize, how much taxes (Federal and NC State - percentage wise) do they take out of your winnings?

Thanks,

~Power Balls

(PS- Not sure which section this post belongs in. So I put it in both. )

Just pick the forum that most closely matches the topic rather than double-posting -- people will find it!

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KY Floyd

NY
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Mar 30, 2009, 10:30 am

Here's a link to a site with all the tax info you need: http://tinyurl.com/cas9
SpanaUnlimited

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Mar 30, 2009, 9:18 pm

Also keep in mind that although the MUSL withholds 25% before they even write you a check. Remember most likely you will be in the 35% tax bracket for the yr. I would suggest contacting tax professionals to deal with this should you ever win

Being in the middle-class most of us are use to having our employers do payroll withholding and we are only paying taxes at one-time when we file(usually April). Usually the point of payroll withholding is so we don't even have to pay....sometimes we get a refund depending on dependents/deductions

Winning the lottery brings alot of responsibility and is a whole different set of rules. Not only do you have lottery income to worry about.....but your normal everyday income(from work, investments, etc...) also need to be calculated together. Since you still owe 10% of your winnings to Uncle Sam......estimate payments are required during the yr.(usually quarterly) Don't wait until April to pay....cuz the IRS may penaltize you. Tax professionals will help you by maximizing your deductions/tax loopholes AND they will be able to give you an exact debt that owed to Uncle Sam.