Question about Taxes

Reply #5

time*treat — Fri, 14 Aug 2009 19:19:44 GMT

The lottery takes out only PART of the taxes you owe, at the beginning.

The lottery withholds 25% for federal taxes before sending you anything.

The state portion will vary by state whether or not it's taken right away.

DC recently changed their rules -- https://www.lotterypost.com/news/193354

Your federal tax total will likely be over 30%, so you will have a balance on your federal tax to pay.

Reply #4

rundown99 — Fri, 14 Aug 2009 03:10:31 GMT

The previous discussions about taxes were about how much federal and state taxes were and which states taxed you. But the discussions were not about whether the lottery instantly deducted the tax amount from the prize or if the winner needed to pay it on their own.

Reply #3

Raven62 — Thu, 13 Aug 2009 19:46:27 GMT

You'll Find the Answer Here

Reply #2

gy65 — Thu, 13 Aug 2009 18:35:00 GMT

What a slacker! You have been a forum member since 2002, and this topic has been discussed in NUMEROUS threads. How hard would it be to fill out a faux 1040 with a multi-million income amount to determine the tax obligation

Reply #1

pigsNtrees — Thu, 13 Aug 2009 14:33:42 GMT

Short answer YES.

This is from

Mega Millions Jackpot Analysis

http://www.usamega.com/mega-millions-jackpot.asp

Under Important Notes it says .

All of the tax amounts listed above are the taxes withheld at the time of the prize award.(25%)

State lotteries typically deduct other amounts from prize payments, such as child support payments, back taxes owed, outstanding student loans, and other government agency responsibilities.

Question about Taxes

rundown99 — Thu, 13 Aug 2009 14:07:59 GMT

I have a question. Does anyone know about the situation regarding taxes concerning the grand prize of a lottery game such as powerball or mega millions?

If someone won a powerball/mega millions jackpot grand prize, would the lottery take the required amount of federal and state taxes IMMEDIATELY before sending the money to the winner or would the winner receive the ENTIRE lump sum after claiming the prize and then pay off the taxes on his or her own? I didn't know if any of you knew abou... [ More ]