Lottery-winning couple 'defrauded' by tax business
Includes video report
A husband and wife who won big off a 2014 Illinois Lottery scratch-off say they don't want what happened to them to happen to anyone else.
Rafael Borsas says he and his wife, who make less than $80,000 a year, went to a nearby Key Express Tax service to have their taxes prepared for them. Instead of being charged $160 for a 1040 single family house owners service, they were overcharged nearly $2,000: $300 for income tax and $1,700 for a gambling bonus.
The commissi ...
Sep 6, 2016, 11:44 am - Lottery News forum
Pennsylvania lottery winners now subject to state tax on prizes
By Todd Northrop
The small number of states that don't tax lottery prizes has just shrunk by one state.
Pennsylvania lawmakers approved levying new taxes Wednesday on a variety of different things including lottery prizes to help support the $31.5 billion state budget that went into effect earlier this week.
The tax bill was approved by a 116-75 vote in the House and 28-22 vote in the Senate. Democrat Gov. Tom Wolf quickly signed the tax bill and related bills to complete the budget pro ...
Jul 20, 2016, 10:43 am - Lottery News forum
N.J. increases initial state tax withholding on lottery winnings
But does not affect what winner would ultimately pay in state taxes
If someone buys a winning ticket for Friday's $540 million Mega Millions game in New Jersey, the state will be collecting more money at payout than it would have last month.
Under the new rates, winnings greater than $10,000 up to $500,000 will have 5 percent automatically withheld, and prizes above $500,000 will face an 8 percent withholding. Previously, prizes greater than $10,000 faced a withholding of 3 percent.
Jul 7, 2016, 8:53 pm - Lottery News forum
Pennsylvania lottery wins to be taxed, if legislation passes
Winning the Pennsylvania Lottery may be a little less lucrative in a proposal that would allow the state to take a share of the jackpot through income tax.
Currently, such winnings are exempt from the state's personal income tax.
What does that mean in practice?
Let's use January's $1.5 billion Powerball jackpot as an example. For those who opted for the hypothetical lump sum the final $1.6 billion take was split between three winners of about $940 million, the feds would withhold a com ...
Mar 15, 2016, 4:02 pm - Lottery News forum
Alabama Gov. compares lottery to leisure suits
Alabama Gov. Robert Bentley took his campaign for tax increases and budget reform to the Bessemer Chamber of Commerce today, where he was asked about whether he's concerned that Alabamians buy lottery tickets in other states.
Bentley indicated an Alabama lottery would not be the budget booster that some people think.
Now listen folks, the lottery is like leisure suits, the governor said. We're about 30 years behind.
Three neighboring states, Georgia, Florida and Tennessee, already hav ...
Aug 2, 2015, 11:37 am - Lottery News forum
Pennsylvania lottery winners to be taxed for the first time
New Penn. Gov. Tom Wolf proposes historic tax increases
By Todd Northrop
Tucked into the depths of Pennsylvania Governor Tom Wolf's first budget plan is a proposal to tax lottery winnings over $600.
The newly-elected Democrat Governor's spokesman says that California and Pennsylvania are the only states with income taxes that exempt lottery proceeds. Some states have no income taxes, and those states also do not tax lottery winners.
We have a massive budget deficit that we need to c ...
May 12, 2015, 10:55 am - Lottery News forum
A state lottery could help Alabama get its financial house in order
Fifty years ago, lotteries were illegal in every state, but they have proven so lucrative and politically irresistible that 44 states have since started selling tickets to the lottery. In 2013, state-run lotteries brought in $62 billion, which amounts to $257 in sales to every adult in the nation.
Six stubborn holdouts remain. Alaska and Hawaii are isolated enough that they do not feel pressured by sales from their neighbors. Nevada and Mississippi have gambling lobbies that don't want a stat ...
Apr 20, 2015, 9:15 pm - Lottery News forum
IRS scammed with losing lottery tickets
Here's one way to dodge the taxman buy thousands of losing lottery tickets.
It's true. Gamblers have concocted a scheme to repurpose the dud ducats to offset their winnings. A winner can go online and get $5,000 worth of losing lottery tickets to cover their $5,000 in gambling winnings. The lottery tickets serve as a sort of security blanket if the auditor comes calling.
Ads captured on Craigslist and eBay from Florida to California hawk the tickets so the potential lotto buyer can defraud ...
Apr 6, 2015, 4:54 pm - Lottery News forum
Will the Puerto Rico Powerball winner pay Federal tax? Nobody knows
For the first time ever, Puerto Rico has a Powerball winner with a whopping $188 million jackpot. And the island is celebrating.
The winning ticket holder will get one-third of the $564 million jackpot, the third-largest in Powerball history and the fifth-largest U.S. lottery prize.
But one mystery remains will the winner pay federal taxes on the prize, or will he or she be exempt, as has always been the case there? Lottery officials in Puerto Rico said they still have no answer to that qu ...
Feb 13, 2015, 7:31 am - Lottery News forum
NJ lottery winners dodge a tax bullet
A proposed extra tax on New Jerseyans' lottery winnings stalled today after it became clear it was unlikely to be approved by a key state Senate panel.
It didn't have the votes, said Senate Budget Committee Chairman Paul Sarlo (D-Bergen).
The bill (S1767) would impose an additional 0.5 percent tax on lottery winnings of more than $600.
The money would be used to fund after school programs run by non-profit groups in municipalities where at least 40 percent of the school district's stud ...
Oct 28, 2014, 10:39 am - Lottery News forum