If a person won, let's say, a $10k sweepstakes / lottery; and nothing was taken out. Does that person need to pay the taxes immediatley or can they wait to claim the winnings on their taxes at the end of the year?
2007-04-09 02:44:49 · 4 answers · asked by ashquadir 1 in Business & Finance ➔ Taxes ➔ Other - Taxes
You will most likely need to send in an estimated tax payment to the IRS when you collect the money.
Winnings will be reported to the IRS so you will have to add them to your income when you do your taxes at the end of the year. Taxes are supposed to be sent to the IRS on a quarterly basis throughout the year which is why your employer takes money from your check instead of just letting you pay it all at the end of the year. If you did not pay any taxes on the $10K during the year, it is very likely that you will face a penalty at tax time for underwithholding.
2007-04-09 03:12:06 · answer #1 · answered by TaxGurl 6 · 1⤊ 0⤋
You show the winnings as income on your tax return at the end of the year. If you haven't paid enough in for withholding, then you might be subject to penalties for under-withholding.
If you itemize, you can claim gambling losses up to the amount of your gambling winnings. But be cautious here - there are very specific rules for the documentation you have to have to do this.
2007-04-09 20:02:39 · answer #2 · answered by Judy 7 · 0⤊ 0⤋
It depends.
My dad paid taxes on a major win in Las Vegas before he ever got the chk one year.
3 years later he won in a similar deal and didnt pay taxes till the end of the year.
Depends on the state too.
2007-04-10 03:46:19 · answer #3 · answered by pcreamer2000 5 · 0⤊ 0⤋
whats the amount you do not have to file
2015-12-17 03:37:43 · answer #4 · answered by ? 1 · 0⤊ 0⤋