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Mega Millions - State Matters

Topic closed. 15 replies. Last post 12 years ago by four4me.

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Greenwich, CT
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Posted: April 9, 2005, 1:27 pm - IP Logged

When the jackpots get this high, your take home cash can be affected by $5-10 million depending on in which state you purchase your ticket.

I do love USA Mega's Jackpot Analysis!  Although you'll certainly have a higher tax liability than 25% if you win the jackpot.  You'd probably be paying close to another $7 million in Federal Tax than the amounts below.

Mega Millions $120 million for 4/12/05.  Cash values:

New York: $47,705,000 after taxes

New Jersey: $52,500,000 after taxes

That's a $5 million difference!!  I don't want $5 million of my money going to New York State!

I would consider using an online service that buys tickets in New Jersey, Texas or Washington (No State Tax) for a 100% premium on the ticket price.  Any thoughts?

    DoctorEw220's avatar - alien helmet.jpg
    Yinzer Country, PA
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    Posted: April 9, 2005, 1:52 pm - IP Logged

    remember that if you are from out of state, and you win the jackpot in a state that doesn't tax its residents if they win, you will still have to pay state taxes. it's a weird rule.

    I've redone my website.  Go to www.dr-ew.com.  I kept a lot of the old stuff, and I've added some new stuff.  Look for more new stuff in the coming weeks.

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      Greenwich, CT
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      Posted: April 9, 2005, 2:00 pm - IP Logged

      Interesting....I live in CT.

      So, If I won on a ticket from NJ, with 0% state tax, I would pay 5% CT Lottery Tax...or would NY want a cut because they're in the middle?

      But if I won in NY, I would have to pay the 6.85% Tax, and couldn't opt for the 5% CT Tax?

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        Chief Bottle Washer
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        Posted: April 9, 2005, 3:01 pm - IP Logged
        Quote: Originally posted by JAG331 on April 9, 2005



        Interesting....I live in CT.

        So, If I won on a ticket from NJ, with 0% state tax, I would pay 5% CT Lottery Tax...or would NY want a cut because they're in the middle?

        But if I won in NY, I would have to pay the 6.85% Tax, and couldn't opt for the 5% CT Tax?




        I think NY would make you pay the difference (1.85%) and 5% would go to CT.  However, that's just a gut call, based on my past dealing with the NY tax authorities.

         

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          Chief Bottle Washer
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          Posted: April 9, 2005, 3:02 pm - IP Logged

          ...And thanks for the nice words about the USA Mega Jackpot Analysis!

           

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            dvdiva's avatar - 8ball

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            Posted: April 10, 2005, 2:55 am - IP Logged

            Well you would think NY tax collectors would say give us the 6.85% and to hell with Connecticut. If you decide to come to Washington we don't have a state income tax but you can feel free to vote over here - everyone else does.

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              Baton Rouge, LA
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              Posted: April 10, 2005, 9:28 am - IP Logged
              Quote: Originally posted by DoctorEw220 on April 9, 2005

              remember that if you are from out of state, and you win the jackpot in a state that doesn't tax its residents if they win, you will still have to pay state taxes. it's a weird rule.






              From what I understand about state income taxes, you have to pay based on the state in which you reside. In other words if you win in a state with no income tax and you live in a state that has income tax, you'd still have to pay.



              PrisonerSix
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                Maryland
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                Posted: April 10, 2005, 10:49 am - IP Logged

                Take a look at Marylands' payout on the Mega Jackpot Analysis. It shows two payouts. One for in-state residents and one for out of state. So, if you buy your ticket here, and you don't live in a tax-free state, you will get screwed all the way around. Notice, we have the highest amount of taxes taken out on a winning ticket.

                Good luck

                litebets

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                  Posted: April 10, 2005, 2:03 pm - IP Logged

                  I buy Mega Millions in New Jersey, and I live in Pennsylvania. Neither state charges income tax on lottery winnings. I'm in a pretty good situation.

                  (insert signature here)

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                    Posted: April 10, 2005, 9:48 pm - IP Logged
                    Quote: Originally posted by PrisonerSix on April 10, 2005



                    Quote: Originally posted by DoctorEw220 on April 9, 2005


                    remember that if you are from out of state, and you win the jackpot in a state that doesn't tax its residents if they win, you will still have to pay state taxes. it's a weird rule.





                    From what I understand about state income taxes, you have to pay based on the state in which you reside. In other words if you win in a state with no income tax and you live in a state that has income tax, you'd still have to pay.

                    PrisonerSix


                    I've checked it out with several states, and that's not true.  For the most part, if the state that sold the ticket has taxes, it will withhold state taxes from your prize, even if you live in a state with no lottery taxes.  Think of it as if you earned the money working in that state.  They would withhold from your paycheck.

                     

                    Check the State Lottery Report Card
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                      Posted: April 11, 2005, 9:44 am - IP Logged

                      Jimmy:

                      You'd have to pay state tax if you win MM, even in NJ.

                        DoctorEw220's avatar - alien helmet.jpg
                        Yinzer Country, PA
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                        Posted: April 11, 2005, 9:56 am - IP Logged
                        Quote: Originally posted by JimmySand9 on April 10, 2005

                        I buy Mega Millions in New Jersey, and I live in Pennsylvania. Neither state charges income tax on lottery winnings. I'm in a pretty good situation.






                        you would be paying state income tax in NJ, most likely.



                        here's how it works:



                        let's say that you live in VA. you purchase a powerball ticket in WV, which does not tax their lottery winners. you win the jackpot. because you do not claim residency in WV, they charge state tax on your winnings. look at the jackpot winnings of Hobart Parnell.

                        I've redone my website.  Go to www.dr-ew.com.  I kept a lot of the old stuff, and I've added some new stuff.  Look for more new stuff in the coming weeks.

                          Todd's avatar - Cylon 2.gif
                          Chief Bottle Washer
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                          Posted: April 11, 2005, 9:56 am - IP Logged
                          Quote: Originally posted by CASH Only on April 11, 2005



                          Jimmy:

                          You'd have to pay state tax if you win MM, even in NJ.





                          Not if you lived in NJ and bought the ticket in NJ - then you would only pay federal taxes.

                           

                          Check the State Lottery Report Card
                          What grade did your lottery earn?

                           

                          Sign the Petition for True Lottery Drawings
                          Help eliminate computerized drawings!

                            DoctorEw220's avatar - alien helmet.jpg
                            Yinzer Country, PA
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                            Posted: April 11, 2005, 9:58 am - IP Logged

                            are more states moving away from charging state taxes on lottery winnings?

                            I've redone my website.  Go to www.dr-ew.com.  I kept a lot of the old stuff, and I've added some new stuff.  Look for more new stuff in the coming weeks.

                              Todd's avatar - Cylon 2.gif
                              Chief Bottle Washer
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                              Posted: April 11, 2005, 10:08 am - IP Logged

                              I doubt it.  Most states are looking for ways to increase revenues at this point, so it would be highly unlikely they would get rid of a tax.  That's the terrible thing about taxes in general: once you start a tax stream, it is almost impossible to get rid of it.

                              After all, look at how hard it was for President Bush to get through his modest tax relief package in the past few years.

                               

                              Check the State Lottery Report Card
                              What grade did your lottery earn?

                               

                              Sign the Petition for True Lottery Drawings
                              Help eliminate computerized drawings!