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Lottery Taxation

Topic closed. 41 replies. Last post 11 years ago by Chewie.

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dphillips's avatar - littleuns
Albuquerque, New Mexico
United States
Member #5128
June 18, 2004
377 Posts
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Posted: August 13, 2005, 3:52 pm - IP Logged

There are about three countries that do not tax their lottery winnings...and excuse the English -- it ain't the United States.  Wow, what a shame!  Now, you would think our Uncle would give us a tax break...about twice a year, Thanksgiving and Christmas, by not taxing our lottery winnings: your actual take home pay would be the amount won!

What can the US learn from those tax free lottery countries?  Is the US government willing to listen?

Finally, I agree we all (no exceptions) should pay our taxes -- but taxing lottery winnings...is a bit too much.

 

 

 

 

 

    dvdiva's avatar - 8ball

    United States
    Member #2338
    September 17, 2003
    2063 Posts
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    Posted: August 14, 2005, 12:45 am - IP Logged

     I totally agree. State lottery income should be both state and federal tax free.

      Avatar
      Wisconsin
      United States
      Member #1610
      June 3, 2003
      668 Posts
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      Posted: August 14, 2005, 3:24 am - IP Logged

      I've always felt that all lottery winnings should be tax-free. (at the very least free of state taxes) It all boils down to the simple fact that the states are benefiting financially from the sale of the original tickets. They've already taken their substantial cut. Why should we all pay "again" when we match the numbers? We've already contributed a very large percentage of each dollar to the states and the various good causes simply by purchasing our tickets. It's only fair.

      ... the lottery never fails to surprise!
        Avatar
        New Mexico
        United States
        Member #12305
        March 10, 2005
        2984 Posts
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        Posted: August 14, 2005, 7:20 am - IP Logged

        I think there's too much government and too much government spending for the good of the population, the future health of the economy, even the survivability of the nation over the long run.  Too much regulation, too much defense spending and war propaganda, too much big brother, and too much taking responsibility for matters the citizenry ought to be handling for themselves.

        However, having said that, if there's going to be a completely pervasive, intrusive, paternal, suffocating government of the US, I can't think of a single reason lottery winners shouldn't be taxed the same as everyone else in this nation where the gross-national-product is measured in trees and raw mineral ore shipped to china for refinement and manufacturing.  We might as well all be choked to death equally.

        It takes a lot of money to run an oligarchy where every third person is employed by the government one way or another.  What possible motive would the government have for exempting lottery winnings from taxation?  And why would anyone who doesn't play the lottery believe it would be fair to do so?

        I honestly don't understand your logic here.  I'd like to read some expanded explanations of the trains of thinking to lead you into such a conclusion.  But don't give me 'fair'.  Fair isn't an issue and never has been.

        Jack

        Absorb the good, ignore the bad, weigh the ugly.

        It's about number behavior.

        Egos don't count.

         

        Dedicated to the memory of Big Loooser

         


          United States
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          July 11, 2004
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          Posted: August 14, 2005, 9:10 am - IP Logged

          One could counter that argument with the fact that the lottery is mostly played by the poor and the poor pay little in income taxes.  The bottom 20 percent in income have an effective average income tax rate of -4 percent because of the earned income credit and other tax credits targeted to the working poor.  Almost all of the income taxes is borne by the top half of the working households with most of that coming from the top 10-20 percent. If anyone wins a million dollar prize, why should they pay any less than a well-paid middle management executive who makes $ 200,000 and pays nearly a third of his income in taxes?

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            New Mexico
            United States
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            March 10, 2005
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            Posted: August 14, 2005, 9:35 am - IP Logged

            One could counter that argument with the fact that the lottery is mostly played by the poor and the poor pay little in income taxes.  The bottom 20 percent in income have an effective average income tax rate of -4 percent because of the earned income credit and other tax credits targeted to the working poor.  Almost all of the income taxes is borne by the top half of the working households with most of that coming from the top 10-20 percent. If anyone wins a million dollar prize, why should they pay any less than a well-paid middle management executive who makes $ 200,000 and pays nearly a third of his income in taxes?

            why should they pay any less than a well-paid middle management executive who makes $ 200,000 and pays nearly a third of his income in taxes?

            Why, indeed.  If there's a tax on 'earnings', how can winning a lottery be considered as somehow different than, say, selling a lot of some illicit recreational drug, which is taxable if they catch a person at it.  Or getting paid some astronomical amount for prancing around a stage shouting into a microphone and waving an electric guitar?  Or throwing and catching footballs better than the average jockstrap?  Or winning a bundle down at the casino?

            What's so special about lottery winnings to make them more worthy of exemption than prancing guitar shouters, handsign rappers, drug dealers, lesser gamblers and mobsters?

            Al Capone died in prison, not because he killed and mutilated a lot of people, not because he was involved in all kinds of illegal activities, but because he didn't pay taxes on his earnings.  We should all strive to emulate him.

            Jack


             

            Absorb the good, ignore the bad, weigh the ugly.

            It's about number behavior.

            Egos don't count.

             

            Dedicated to the memory of Big Loooser

             

              konane's avatar - wallace
              Atlanta, GA
              United States
              Member #1265
              March 13, 2003
              3348 Posts
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              Posted: August 14, 2005, 11:45 am - IP Logged

              I say we adopt the Fair Tax which eliminates all income tax, all payroll tax and in turn should wipe out all income taxes on lottery winnings.

              Check out the article in my blog which gives a rough outline of the proposal and highlights a recently written book which throroughly explains what the Fair Tax will accomplish. 

               http://blogs.lotterypost.com/konane/

              Good luck to everyone!

                konane's avatar - wallace
                Atlanta, GA
                United States
                Member #1265
                March 13, 2003
                3348 Posts
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                Posted: August 14, 2005, 12:09 pm - IP Logged

                I say we adopt the Fair Tax which eliminates all income tax, all payroll tax and in turn should wipe out all income taxes on lottery winnings.

                Check out the article in my blog which gives a rough outline of the proposal and highlights a recently written book which throroughly explains what the Fair Tax will accomplish. 

                 http://blogs.lotterypost.com/konane/

                BTW don't know how I managed to copy that 3 times .... was making some html changes and updated the blog but due to my inexperience copied it twice more than I wanted to so have asked Todd to wipe out the duplicates.  Confused

                Good luck to everyone!

                  four4me's avatar - gate1
                  MD
                  United States
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                  June 18, 2003
                  8393 Posts
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                  Posted: August 14, 2005, 12:20 pm - IP Logged
                  we went to war over the tax issue because we were being over taxed without representation. And now we are being overtaxed again with representation by the people we vote into office. Reality bites big time doesn't it. Practically every person who runs for office says no more taxes. Then within a few months or more give or take a few. They go on record having said we need to adjust the tax rates because we need money for this or money for that.
                  Just about every thing imaginable is taxed now including the air we breath. There is almost nothing that isn't taxed. Imagine that!!! One of the worst parts about being taxed is the income tax. They take money out of our pay checks every week. Then at the end of the year take more tax out of our overall income again. Well wait a minute here didn't we pay taxs every week to the state and fed gov. Now their gonna tax me some more on the money i earned all year. Ok i know some of us get some of this money back but it still boils down to having to pay income tax on money we earned and paid tax every week, for having a job.
                  Some people think this is not constitutional and i agree they say there are no laws that say we must pay income tax. However if you don't you will get fined for not doing it and possibly end up in jail.
                  But this thread is about lottery tax. Uncle didn't contribute his money into the pot so uncle shouldn't have his fingers in it for taxes purposes. Uncle is making big money on the returns of the money we contribute to the lottery pots buy making investments on it. Uncle also states that the money they earn goes towards the general funds in most states yet they complain that they haven't enough money for schools, teachers, police, fire, roads and bridges etc etc. After reporting a surplus of money. Well somebody's getting the money but who knows for sure which department is getting what and how much. Which goes back to the earlier comment didn't they take money out of our paychecks for these things.
                  Tax it's a pain in the butt!!! every since George Washington threw those silver dollars across's the Delaware river we've been paying for it every since.
                    dvdiva's avatar - 8ball

                    United States
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                    September 17, 2003
                    2063 Posts
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                    Posted: August 14, 2005, 4:55 pm - IP Logged

                    One could counter that argument with the fact that the lottery is mostly played by the poor and the poor pay little in income taxes.  The bottom 20 percent in income have an effective average income tax rate of -4 percent because of the earned income credit and other tax credits targeted to the working poor.  Almost all of the income taxes is borne by the top half of the working households with most of that coming from the top 10-20 percent. If anyone wins a million dollar prize, why should they pay any less than a well-paid middle management executive who makes $ 200,000 and pays nearly a third of his income in taxes?

                    Because the average rich person's revenue didn't come from a tax to begin with. Lotteries are a form of self taxation. This is why in Europe which is hardly known for low taxes doesn't tax lottery income. Also with heavy compition from Online and Indian casino's state lotteries need to offer something to it's players who are contributing to the state coffers by playing in games that support state expenses. People don't have to buy lottery tickets. Many prefer to try their luck at Indian casinos or playing poker online. An executive's income does not come from the same source. The whole point of a jackpot is so people will buy the tickets and 50% of that money (or more) goes to the state at the point of sale. 50% of the executives money does not. If the tax collectors and state finance managers of Europe can figure that one out then one would hope that americans could also.

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                      Sparta, NJ
                      United States
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                      July 9, 2005
                      1977 Posts
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                      Posted: August 14, 2005, 5:37 pm - IP Logged

                      I say we adopt the Fair Tax which eliminates all income tax, all payroll tax and in turn should wipe out all income taxes on lottery winnings.

                      Check out the article in my blog which gives a rough outline of the proposal and highlights a recently written book which throroughly explains what the Fair Tax will accomplish. 

                       http://blogs.lotterypost.com/konane/

                      Flat tax will never happen.

                      You're asking a Congressperson to limit the amount of a pay raise they can give themself. The power of Congress come from MONEY. No way is a person going to put any sort of restriction on how they spend money. Money is power. The control of money is the ultimate power. What would happen to entitlements when the flat tax money runs out - will they be cut-off. Heheheheheh! Polyana thoughts! As long as Congress can raise a tax, they can buy anything they want. Think of a Congressperson sitting in their corporate paid jet, on their way to a corporate paid vacation, to play corporate paid golf. Think of all the tax deductions that would be removed: charities, business trips, business planes, corporate complexes, energy efficiency (cheaper gas), home ownership mortages - the list goes on. Remember, you can't get an amendment to the Constitution without first getting a bill through Congress.  Do you really think they would eliminate that without a fight to the death?

                      Senators Byrd or Lautenburg don't stay in office because they loves America. They, along with all their cronies, stay in, because they don't have enough buildings and roads named after themselves. That ego-buying costs money. Money comes from taxpayers. When was the last time Congress voted down all Pork-Barrel spending? The same vote that authorised the flat-tax!

                       

                      Cheers

                      |||::> *'`*:-.,_,.-:*''*:--->>> Chewie  <<<---.*''*:-.,_,.-:*''* <:::|||

                      I only trust myself - and that's a questionable choice

                        konane's avatar - wallace
                        Atlanta, GA
                        United States
                        Member #1265
                        March 13, 2003
                        3348 Posts
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                        Posted: August 14, 2005, 5:44 pm - IP Logged

                        I say we adopt the Fair Tax which eliminates all income tax, all payroll tax and in turn should wipe out all income taxes on lottery winnings.

                        Check out the article in my blog which gives a rough outline of the proposal and highlights a recently written book which throroughly explains what the Fair Tax will accomplish. 

                         http://blogs.lotterypost.com/konane/

                        Flat tax will never happen.

                        You're asking a Congressperson to limit the amount of a pay raise they can give themself. The power of Congress come from MONEY. No way is a person going to put any sort of restriction on how they spend money. Money is power. The control of money is the ultimate power. What would happen to entitlements when the flat tax money runs out - will they be cut-off. Heheheheheh! Polyana thoughts! As long as Congress can raise a tax, they can buy anything they want. Think of a Congressperson sitting in their corporate paid jet, on their way to a corporate paid vacation, to play corporate paid golf. Think of all the tax deductions that would be removed: charities, business trips, business planes, corporate complexes, energy efficiency (cheaper gas), home ownership mortages - the list goes on. Remember, you can't get an amendment to the Constitution without first getting a bill through Congress.  Do you really think they would eliminate that without a fight to the death?

                        Senators Byrd or Lautenburg don't stay in office because they loves America. They, along with all their cronies, stay in, because they don't have enough buildings and roads named after themselves. That ego-buying costs money. Money comes from taxpayers. When was the last time Congress voted down all Pork-Barrel spending? The same vote that authorised the flat-tax!

                         

                        If enough people start educating themselves and demanding it of their Reps and Senators then they just may listen if it means staying in office. 

                        Never say never although it is an uphill battle that will not be easily won.

                        Good luck to everyone!


                          United States
                          Member #5565
                          July 11, 2004
                          260 Posts
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                          Posted: August 14, 2005, 5:53 pm - IP Logged

                          [quote]Because the average rich person's revenue didn't come from a tax to begin with. Lotteries are a form of self taxation. This is why in Europe which is hardly known for low taxes doesn't tax lottery income.[/quote]

                          Since the lotteries are primarily paid by the poor who pay little or no income taxes, the revenue is often being subjected to tax for the first time.  The lowest two quintiles (the bottom 40%) actually receive a tax refund from the federal government exceeding the income taxes withheld during the year.

                           

                          http://www.taxpolicycenter.org/TaxFacts/TFDB/TFTemplate.cfm?Docid=224


                          Taxing the winnings doesn't constitute double taxation in these cases.  There's no such thing as self-taxation  since although the law refers to the taxes as contributions they're in fact mandatory.

                            Avatar
                            Sparta, NJ
                            United States
                            Member #18331
                            July 9, 2005
                            1977 Posts
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                            Posted: August 14, 2005, 6:03 pm - IP Logged

                            I say we adopt the Fair Tax which eliminates all income tax, all payroll tax and in turn should wipe out all income taxes on lottery winnings.

                            Check out the article in my blog which gives a rough outline of the proposal and highlights a recently written book which throroughly explains what the Fair Tax will accomplish. 

                             http://blogs.lotterypost.com/konane/

                            Flat tax will never happen.

                            You're asking a Congressperson to limit the amount of a pay raise they can give themself. The power of Congress come from MONEY. No way is a person going to put any sort of restriction on how they spend money. Money is power. The control of money is the ultimate power. What would happen to entitlements when the flat tax money runs out - will they be cut-off. Heheheheheh! Polyana thoughts! As long as Congress can raise a tax, they can buy anything they want. Think of a Congressperson sitting in their corporate paid jet, on their way to a corporate paid vacation, to play corporate paid golf. Think of all the tax deductions that would be removed: charities, business trips, business planes, corporate complexes, energy efficiency (cheaper gas), home ownership mortages - the list goes on. Remember, you can't get an amendment to the Constitution without first getting a bill through Congress.  Do you really think they would eliminate that without a fight to the death?

                            Senators Byrd or Lautenburg don't stay in office because they loves America. They, along with all their cronies, stay in, because they don't have enough buildings and roads named after themselves. That ego-buying costs money. Money comes from taxpayers. When was the last time Congress voted down all Pork-Barrel spending? The same vote that authorised the flat-tax!

                             

                            If enough people start educating themselves and demanding it of their Reps and Senators then they just may listen if it means staying in office. 

                            Never say never although it is an uphill battle that will not be easily won.

                            Lets see, if fewer than 50% of any given populace bother to vote for their Congressperson, and the average cost to run for that position is close to a million dollars, and that person better be sqeeky-clean to the bone, I see no change in the system in several life times. If your platform to reduce entitlements by voting in the flat-tax, the lower income will start the busses running 24/7. It took us over 250 years to get to the position we are in. It sound be atleast double that to get back the original Constitution - which had no tax (because the Boston Tea Part was about taxes!).

                            Cheers

                            |||::> *'`*:-.,_,.-:*''*:--->>> Chewie  <<<---.*''*:-.,_,.-:*''* <:::|||

                            I only trust myself - and that's a questionable choice

                              Avatar
                              New Mexico
                              United States
                              Member #12305
                              March 10, 2005
                              2984 Posts
                              Offline
                              Posted: August 14, 2005, 6:38 pm - IP Logged

                              I say we adopt the Fair Tax which eliminates all income tax, all payroll tax and in turn should wipe out all income taxes on lottery winnings.

                              Check out the article in my blog which gives a rough outline of the proposal and highlights a recently written book which throroughly explains what the Fair Tax will accomplish. 

                               http://blogs.lotterypost.com/konane/

                              Flat tax will never happen.

                              You're asking a Congressperson to limit the amount of a pay raise they can give themself. The power of Congress come from MONEY. No way is a person going to put any sort of restriction on how they spend money. Money is power. The control of money is the ultimate power. What would happen to entitlements when the flat tax money runs out - will they be cut-off. Heheheheheh! Polyana thoughts! As long as Congress can raise a tax, they can buy anything they want. Think of a Congressperson sitting in their corporate paid jet, on their way to a corporate paid vacation, to play corporate paid golf. Think of all the tax deductions that would be removed: charities, business trips, business planes, corporate complexes, energy efficiency (cheaper gas), home ownership mortages - the list goes on. Remember, you can't get an amendment to the Constitution without first getting a bill through Congress.  Do you really think they would eliminate that without a fight to the death?

                              Senators Byrd or Lautenburg don't stay in office because they loves America. They, along with all their cronies, stay in, because they don't have enough buildings and roads named after themselves. That ego-buying costs money. Money comes from taxpayers. When was the last time Congress voted down all Pork-Barrel spending? The same vote that authorised the flat-tax!

                               

                              If enough people start educating themselves and demanding it of their Reps and Senators then they just may listen if it means staying in office. 

                              Never say never although it is an uphill battle that will not be easily won.

                              Lets see, if fewer than 50% of any given populace bother to vote for their Congressperson, and the average cost to run for that position is close to a million dollars, and that person better be sqeeky-clean to the bone, I see no change in the system in several life times. If your platform to reduce entitlements by voting in the flat-tax, the lower income will start the busses running 24/7. It took us over 250 years to get to the position we are in. It sound be atleast double that to get back the original Constitution - which had no tax (because the Boston Tea Part was about taxes!).

                              It took us over 250 years to get to the position we are in.

                              Untrue.  The income tax began during the early 20th Century to fund WWI.  It was only a few decades after that we arrived in the position we're in now.... around the end of WWII.

                              It sound be atleast double that to get back the original Constitution - which had no tax (because the Boston Tea Part was about taxes!).

                              250 years won't be nearly long enough. 

                              The country's too perfect, the people too smart and proud to ever stand up to a government again.  It also helps that the people are fat, illiterate, spoiled, brainwashed and generally gutless.

                              Jack

                              Absorb the good, ignore the bad, weigh the ugly.

                              It's about number behavior.

                              Egos don't count.

                               

                              Dedicated to the memory of Big Loooser