Lottery tax question...

Reply #21

a911scanner — Sat, 01 Mar 2014 23:44:55 GMT

Although many of you are correct on the remainder due for the tax year in which you collect, please be aware that, more than likely, you will not be able to wait until the following April 15th to make a payment.

More than likely you would be required to make quarterly payments towards your bill that will be due next April.

I am not an accountant, but I did stay at a Holiday Inn Express last night.

Reply #20

bluerain — Thu, 27 Feb 2014 13:50:29 GMT

do u think or know

Reply #19

nina09 — Tue, 25 Feb 2014 21:21:02 GMT

Yes they are due the following year. You can use your lifetime tax exemption but that still wont cover it because you are only allow to give 5 million tax free but that literally means lifetime and you wont be able to give anything else in your lifetime or death without paying taxes on it.

That's why is important to have a good estate planner , there is many way they can help you set to a trust to limit your tax liability.

Reply #18

Drenick1 — Tue, 25 Feb 2014 20:56:28 GMT

If you want to win $65 million after taxes than you need to be the sole winner of a $200 million annuity jackpot.

Reply #17

SergeM — Tue, 25 Feb 2014 14:37:32 GMT

I think that the first question is, how do I win 65E6 USD before taxes.

Reply #16

CDanaT — Tue, 25 Feb 2014 14:15:48 GMT

If someone could answer this question I would greatly appreciate the input.... Provided you won a very large jackpot with a take home of roughly $65 million after taxes. If you wanted to give a $11 million to your parents and $11 million to your 2 siblings for a total give away of $33 million. Are the gift taxes due the following year or is there some other legal ruling as far as estates are concerned?

*Oh, I realize the best way is to include them on the initial claim in a trust for tax r... [ More ]

Reply #15

SergeM — Tue, 25 Feb 2014 10:44:29 GMT

You pay tax on the money you earned by working.

You pay a tax when buying a ticket.

You pay tax when you cash in the win.

When you go shopping with the won money, you pay a tax.

Finally nothing is left. How much tax on your coffin nails

Reply #14

LottoMetro — Tue, 25 Feb 2014 06:18:55 GMT

Think of it this way: if you invested money and made capital gains during the year, could you keep making money using the capital gains even though they are taxed? Yes, but you will have to pay tax on those returns and any returns on returns!

Unless of course.....you put them in a tax-exempt security. Example, short-term municipal bonds. You would still have to pay the remainder or that 14.6% of the original income that wasn't withheld, but you get some tax-free interest in the meantime. CDs... [ More ]

Reply #13

Coin Toss — Tue, 25 Feb 2014 05:53:04 GMT

Let's say you in PB at its $50M start point. Let's assume you opt cash and get about $28.2M (USA MEGA currently). So that's taxed on the spot at 25%. Now you have $21,150,000.

Next April 15th you're going to get taxed another 14.6%. $4,117,200 is 14.6% of $28.2M$

So since you have enough money to do this, would putting $4,117,200 in a CD or something pay the tax due the following April and make a few bucks. Or would you get taxed more because you did this?

I know it sounds like a lame q... [ More ]

Reply #12

Stack47 — Mon, 24 Feb 2014 15:19:52 GMT

But, if you dont have enough in dedections, it wont matter.

And sometimes not enough in winnings because we lose most of our standard deductions using Schedule A . If we have winnings of $5000 and have $5000 in losses, we're trading a $6100 standard deduction for $5000 in gambling losses.

Reply #11

mikeintexas — Mon, 24 Feb 2014 06:04:22 GMT

The last time the JP was huge, I did some figuring on that; depending upon just when you claimed your prize and how large it was, you could make a fair amt. of interest on the difference - the 14.6%. For example, if the JP was 100 million cash value and they took the 25 million out, you'd still get to use that 14.6 million. I didn't get really involved with my calculations, but if you won/claimed the prize this month and even at .5% interest (one half of a percent), you could make something like... [ More ]

Reply #10

HEMI6point1 — Mon, 24 Feb 2014 03:27:19 GMT

Thanks for the info guys, that clears things up a bit.

Reply #9

schmuckatelly — Sun, 23 Feb 2014 16:18:51 GMT

Also if you are not aware, anything over 600 is reported to the IRS but the withholdings dont start unless you win over $5,000. Also like a previous poster said, you can deduct your losses up to the amount of your winnings. But, if you dont have enough in dedections, it wont matter.

Reply #8

maringoman — Sun, 23 Feb 2014 15:11:32 GMT

you nailed it.

Reply #7

CDanaT — Sun, 23 Feb 2014 15:04:38 GMT

Hemi,

Just remember, lottery is the same as earned income. The federal government automatically takes 25%, right off the bat. But, because it is earned income, you will be taxed at the rate of 39.6%(highest at the government level)

Be ready if you win a jackpot this year because you will end up paying that additional 14.6% on April 15th, 2015. Minus any deductions that you acrue.

EX:

You win $40 million cash, Feds take $10 million(25% initial take) which leaves you $30 million.Fed... [ More ]

Reply #6

Artist77 — Sun, 23 Feb 2014 15:03:18 GMT

This is sort of related. When I met with my accountant yesterday to get my tax return filed, I asked him a question about lottery winnings. He is a Sr. accountant and said ALL gambling $ spent could be offset up to the amount of the winnings. So if you win PB, you can alslo deduct money spent on MM, scratchers and all games (have to save your tickets). I thought this was the case but wanted to verify it.

Reply #5

Saylorgirl — Sun, 23 Feb 2014 14:49:34 GMT

In every state if you win the jackpot you will pay 25% in federal taxes when you collect your winnings. The additional 14.6% will be due on April 15th the following year. A good account and proper planning can reduce this amount depending on your deductions. You are lucky in Florida you do not pay an additional tax to your state. Many states have state taxes that are due when you collect your winnings.

Reply #4

bigbear29 — Sun, 23 Feb 2014 14:48:26 GMT

I did not know about a gambling tax, think that gambling tax is for most states

Reply #3

notmyday — Sun, 23 Feb 2014 14:30:23 GMT

in fl you pay 25% up front and depending on your writeoff you will get a 1099 for a gambling tax so yes it is additional 14% that is what gets most people as they dont save any money back for that. but if you win you are still ahead of the game so a win is a win. now i havent won myself yet but a good friend did and he got hit with the gambling part of the tax at the end of the year so he is now on a payment system with them as he spent all of his winnings and didnt set any back.

Reply #2

bigbear29 — Sun, 23 Feb 2014 14:22:46 GMT

I'm not sure, but I think you only pay federal and state taxes when you claim your winnings. And you don't pay any income taxes on this money the following year. You will get a statement from your bank on the interest that was paid to your account and I think you pay taxes on that.

Reply #1

rcbbuckeye — Sun, 23 Feb 2014 14:21:05 GMT

In Texas, if you win over $5000, they will take 25% when you claim. How much you have to play when you file your tax return depends on your income and your deductions determining what tax bracket you would be in. You may get some back, you may have to pay more. If you win a major jackpot (millions), you most likely will be in the top tax bracket and you would pay more.

Lottery tax question...

HEMI6point1 — Sun, 23 Feb 2014 14:05:57 GMT

Just curious on something. I live in a state that doesn't have state income tax (Florida).

One person told me the tax on FL lottery winnings is 25% one time at the time you claim your prize and nothing more. Another person told me it's the 25% then another 14% when you do your taxes in the beginning of the year for a total of 39%.

So who is right? If it's the latter, that kind of blows....