pay taxes on lotterty winnings?

Question

l live in Rhode lsland. l play the Massachusetts lottery, Mega Millions which R.l. does not have. "lf" l were to win the Mega Millions, do l have to pay both Mass. and R.l. taxes.

Answer 1

You would definitely have to pay Rhode Island state income tax, and possibly Massachusetts state income tax (non-resident tax return). If you did have to pay Massachusetts income taxes, you would get a credit from Rhode Island for the tax you had to pay to Massachusetts. But it wouldn't be a $ for $ credit. It would be the lessor of the Massachusetts tax, or the Rhode Island tax on the same income.

Answer 2

Probably yes, depends on the state laws. A while back in Ohio there was a winner and the city tried to sue for taxes but lost because of some clause in the laws. After the lost they immediately changed the laws. Lottery winnings are considered income and thus taxable. But if you win who cares. 1/2 million after taxes on a million is better then nothing.

Answer 3

I believe that the taxes on lottery winnings are tied to your income taxes. Obviously if you win a huge amount, your income goes up. If you pay state income taxes, then you would have to pay a higher amount based on your income. Don't worry, if you win you will have enough money to hire a financial adviser that can talk you through the tax implications. I'm sure the IRS would contact you as well. ;)

Answer 4

Of course, you know that you'll pay federal income tax on it, no matter where you live. As for state income tax, you only owe for where you live or work, or both.

In the case of winning the lottery, it's not income from wages, so even if you worked in Mass while living in RI, you still wouldn't owe Mass income tax on it.

Answer 5

Probably but it would be worth it. Also don't forget Federal.

Answer 6

yes