I have a question about payments.

Reply #7

dvdiva — Sat, 16 Sep 2006 03:37:55 GMT

Tax-free muni bonds are exempt from federal income tax. That's why they are popular. The interest rates are lower than other bonds however.

www.morganstanleyindividual.com/markets/bondcenter/school/faq/#1

www.bondsonline.com/freemuni.html

www.irs.gov/taxexemptbond/topic/index.html ( under development)

en.wikipedia.org/wiki/Municipal_bond

That should answer your questions on them.

Reply #6

TheGameGrl — Sat, 16 Sep 2006 03:23:58 GMT

dvdiva- correct on the municpal bonds *UNTIL* They mature and they are cashed in. They are under tax shelter during the time frame (usually 5year or ten year bond limits). Heck a person can buy federal blue bonds and be sheltered til they mature after 20 years. But why tie the cash funds up simply to avoid the inevitable. The government gets its tax revenue at some point.

The goal is to lessen the % given in and invest it in such a way that enhances positive revenue.

35% is the cap for

Reply #5

dvdiva — Sat, 16 Sep 2006 03:06:14 GMT

You will owe currently 35% federal plus any state income tax each and every year. As the tax rate goes up so does the amount you owe. If you choose cash you pay tax once and if you get tax-free muni bonds then every check is free from federal income tax.

Reply #4

CASH Only — Fri, 15 Sep 2006 17:17:49 GMT

I agree: if there's a cash option, you should take it. But, if there's no cash option, like GA Lose for Life, you should BOYCOTT it.

Reply #3

SirMetro — Thu, 14 Sep 2006 17:43:12 GMT

Below is what the State of Georgia does http://www.galottery.com/gen/aboutUs/faq.jsp#14

Q.Are State Federal Taxes withheld on Georgia Lottery Prizes?

A.Yes. All Georgia Lottery prizes are subject to applicable federal and state withholdings, and state and federal income taxes. The GLC reports to the IRS and Georgia Department of Revenue the names of winners of prizes of $600 and above. Georgia state income tax of 6% and federal income tax of 25% are withheld from prizes of more than $5,... [ More ]

Reply #2

Just6ntlc — Thu, 14 Sep 2006 15:00:06 GMT

That's why if I win any PB or MM ticket in a state that has sales tax added, I should take cash option. Since I'm living in CA, there's a 50/50 chance I'll take payments because there's no sales tax deducted from winnings.

Reply #1

weshar75 — Thu, 14 Sep 2006 14:50:35 GMT

The lottery takes a percentage out of your annual payments but what you finally pay for the year depends on how you use the money throughout the tax season. Keep in mind that the percentage that the lottery takes is not what you will finally owe the federal and state government. Example is the state lottery hands you your payment minus 25% federal taxes and no state taxes are taken out. Then at tax time you have to pay the federal taxes another additional 10% and then say a 5% state tax on yo... [ More ]

I have a question about payments.

Chamillionaire — Thu, 14 Sep 2006 12:16:31 GMT

say if you won the state lottery or a multi-state lottery and you took payments, do they already take the federal tax out of every check you get, or do you have to pay the tax on every check you get for every year