The question says it all. If I win a large sum of money why does the government tax it. I pay taxes every year on my income so why the money I won.
2007-12-06 13:38:25 · 18 answers · asked by postal247 2 in Business & Finance ➔ Taxes ➔ United States
Because the money you won was income. You don't just pay taxes on income from a job, but also many other kinds of income.
2007-12-06 14:58:42 · answer #1 · answered by Judy 7 · 1⤊ 0⤋
If you won enough to be over the filing limit, yes for federal. If it's a state lottery, some states don't tax wins on their own lotteries.
2016-04-07 22:47:46 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Because, the US government taxes citizens on all income, unless that source is specifically listed as a source of income that isn't taxed (such as municipal bond interest).
Not all states tax lottery wins in their own state. For example, PA residents don't pay state taxes on PA Lottery winnings but they do on lottery winnings from other states.
2007-12-06 13:59:01 · answer #3 · answered by shoredude2 7 · 1⤊ 0⤋
I believe you actually have to pay taxes on any sum of money won. And life just sucks and then you pay taxes and then you die. But be glad you won a large sum of money and stop whining.
2007-12-06 13:41:21 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Australia does not tax lottery or other gambling winnings. However other income earned from those winnings are taxable. Tax is paid on the amounts gambled.
2007-12-06 13:55:25 · answer #5 · answered by AussieGent 4 · 0⤊ 0⤋
If you win and don't want to pay taxes, then move to Canada and win up there where lottery winnings are tax free.
2007-12-06 13:42:44 · answer #6 · answered by cottagstan 5 · 0⤊ 0⤋
yes you have to pay tax on the lotto income.
There is a good news too. you can claim the deductions for lotto loss upto the amount of winning. ( in case you lost money in lotto during the year).
2007-12-06 14:41:39 · answer #7 · answered by sukhvir p 1 · 1⤊ 0⤋
You need to move to Canada, change your citizenship to Canadian and win the Canadian lottery--their government doesn't tax lottery winnings.
The US government does.
2007-12-06 13:42:09 · answer #8 · answered by Anonymous · 0⤊ 0⤋
Because it's considered income
2007-12-06 13:40:49 · answer #9 · answered by linkin 2 · 1⤊ 0⤋
Yes you have to pay taxes. State and Federal.
2007-12-06 13:41:38 · answer #10 · answered by just me 6 · 0⤊ 2⤋