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Court Orders City To Return Couple’s Tax On Lottery Winnings

Ohio LotteryOhio Lottery: Court Orders City To Return Couple’s Tax On Lottery Winnings

Ohios highest court says one Northeast Ohio city cant tax lottery winnings under its current law.

The Ohio Supreme Court ruled 7-0 Wednesday in favor of a Euclid couple that was ordered to pay $102,000 after winning $3.5 million in the Ohio Lottery in 1998. The court says the money is not taxable because it does not fit the definition of taxable income under Euclid city law.

The citys ordinance defines taxable income as wages, salaries and other compensation paid by an employer and-or the net profits from the operation of a business.

The Cuyahoga County Common Pleas Court ruled against the couple, saying the lottery winnings were the net profits of&activities conducted in the city." The county court ruled that the purchase of a lottery ticket constituted an activity subject to the tax.

However, the Supreme Court has a different interpretation. In looking at Euclid's law, Justice Francis Justice Sweeney writes courts must apply the clear meaning of the words used.

The court says if Euclid had altered its law, it could have taxed the lottery winnings.

Columbus Dispatch

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