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5 Answers

Do you have to claim lottery winnings as income when you file your taxes?

Asked by: megan 1098 views YA Discussion

There is an ongoing debate in my ‘office pool’ regarding the lottery.
If we were to win and took a lump sum; at the end of the year, would we have to claim money won as income when we filed our taxes, even though we already paid taxes when we won?

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5 Answers



  1. Rick B on Aug 19, 2011 Reply

    Of course you have to claim it.

    The taxes withheld would offset what you owe ( just like the taxes on your paycheck).

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  2. Judy on Aug 19, 2011 Reply

    Yes. The tax paid when you won is just withholding, like money withheld from your paycheck – it could be too little or too much.

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  3. Bostonian In MO on Aug 19, 2011 Reply

    You didn’t pay taxes when you won. Tax was withheld from the win. That’s the same as taxes being withheld from your pay, but is NOT the same as having paid the tax. You’d each report your share of the win and the tax withheld on your individual returns, the same as you do with your wages right now. You’d each receive a W-2G showing the amount of the win and the tax withheld.

    Do note that the 25% that is withheld for taxes most likely will NOT be enough to cover the total tax bill. That is especially true on a big multi-million dollar hit.

    If you do get lucky, be SURE that you claim the prize as a group! That way it will be distributed and taxed properly. If one person claims it, they will pay the tax and be the sole winner. That would get very messy even if he or she was scrupulously honest and shared the winnings with everyone in the pool.

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  4. tro on Aug 19, 2011 Reply

    they might withhold income taxes from the distribution but until you claim it on your tax return is only prepaid taxes which might result in some of it being refunded, that all depends

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  5. the kid on Aug 19, 2011 Reply

    Yes. Tax withheld is an estimate. You may owe more or get a refund depending on you individual tax situation.

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