If you hit the lottery for $42 million?

Question

how much do they take out for taxes?

Answer 1

in ca for example, they show the cash pay-out along withn the jackpot amount. depending on where treasury bonds zero coupon rates are trading, they calculate the present value of those 26 payments. the higher the interest rates, the less is the present value of that payment stream. now it's appx at 57.77% of the jackpot BEFORE FEDERAL TAXES. in ca, they don't charge you a state income tax for lottery winnings. you will be liable for the federal tax. in ca, they deduct a flat 25% for federal taxes. but you may still be liable for the top tax rate of 35%. if you win ( hopefully), you will get a check for 0.5777* 0.75(1-0.25=complement of 25%)= 43.3275 % of the jackpot.

ATTN : I DON'T KNOW IF FOR FEDERAL TAX PURPOSES, THE MAXIMUM TAX RATE IS 25% OR NOT. MAYBE LOTTERIES HAVE A SPECIAL EXEMPTION FROM BEING TAXED AT THE MAXIMUM INCOME TAX LEVEL OF 35%. IF NOT, THEN YOU PAY A TAX OF 35% AND NOT 25%. SO YOUR AFTER TAX LUMP-SUM WINNINGS WILL BE 0.5777*0.65( 1-.35= complement of 35%)= 37.5505%.

if 25%, your after-tax winnings will be $42mm * 0.433275= $18.19755mm

if 35%, your after-tax winnings will be $42*0.0.375505=$15.77121mm .

Answer 2

If this is a Florida lottery, the withholding rates are: a) 25%, if you are a citizen or resident alien with a Social Security number; b) 28%, if you are a citizen or resident alien without a Social Security number; and c) 30%, if you are a nonresident alien. These are the withholding requirements set by the IRS. The Florida Lottery is required to report all winnings $600 and above to the IRS.

Answer 3

The maximum Federal tax rate is 35% so it would be a hair under that.

If your state levies an income tax, add the max to that as well. However at least some states do not levy income tax against their own residents who win the state's lottery so you'll have to check with your state tax authorities on that aspect.

Answer 4

About 35%. More importantly, the $42 million is a nominal value if you take the 30-year annuity; if you get the cash up front it's only half of that. So if you take cash, after taxes you'd have 'only' about $13.5 million - still a nice chunk of change.

Answer 5

Depends on the state that you live in and the creativity of your tax person. Also, do you take lump sum or over a number of years? Use 40 to 45% to be safe.

Answer 6

About 42%, which is about $17,640,000.

Answer 7

You'd owe very close to 35% to the feds. Depending on your state, you might owe something there also.

Answer 8

THEY TAKE 50%

Answer 9

idk but ur lucky if u won 42 million!!!!