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Are lottery winnings taxed twice ?
Let's say you win a $1,000,000 lottery. In my state, they take 5% of your winnings and the government takes 25%, so you'd end up with $750,000.
When you file your taxes, are you taxed again on the $750,000, as it's considered 'income'.or does it depend on your income for the year, or do you NOT have to pay any further tax on your winnings ?
2 Answers
- pdqLv 77 years agoFavorite Answer
You're not understanding the basic concept of filing your taxes.
When you file your taxes, you are merely telling the government how much you paid them in taxes already based on the income you received that year. (Any gambling winnings are considered income by the government.)
In the process of telling the government how much in taxes you have paid, you also need to figure out how much you were supposed to pay. You do this by looking at all sorts of charts that the government provides. The more you make in income, the more you're supposed to pay. Finally, you subtract how much you gave the government from how much you were supposed to give them. If you gave them too much, you get a refund. If you did not give them enough, then you have to pay them more money.
Good news - Anyone who ever would win that much money would hire a tax attorney.
Bad news - You'll never win that much money. Ever.
- 7 years ago
Judging by your poor grammar and sentence structure, you're probably 16 years old, and most likely know little to anything about actual tax law. Also, very nice infantile 'dig' at the end of your answer.
Go back to your Mother's basement and keep playing WOW and let the adults answer the question.
