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9 Answers

do you have to pay tax on lottery winnings twice?

Asked by: megan 2663 views YA Discussion

What i mean is – Taxes are usually taken out before they cut the check, but will you have to pay tax again at tax time?

How others found here:

  • do you get taxed twice on lottery winnings
  • do i get taxed twice on lotteries
  • Do you get taxed twice in sweepstake winnings

9 Answers

  1. tro on Sep 16, 2011 Reply

    no, if an amount is withheld in the payout check that amount is claimed on the tax return just like you report the amount that your job has withheld for income tax
    that applies to your total income tax liability

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  2. Christopher on Sep 16, 2011 Reply

    No. The taxes are taken out based on the estimated tax bill. At the end of the year, you’ll do your tax return, figure out exactly what it should be, and either pay in more or get a refund depending on how the estimated tax compares with the actual tax bill.

    Fun fact: Lottery winnings are not taxed in Canada.

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  3. chatsplas on Sep 16, 2011 Reply

    What is taken out is withholding, not payment of tax, just like your paycheck
    At yearend, you file a tax return reporting all income, and figure your tax and if your withholding is inadequate, you pay more, if your withholding is good, you get nothing or a refund
    Your tax is figured on your tax return using ALL income from all sources. . . .then you pay tax, before that, it is only withholding, an estimate, which may or may not be accurate

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  4. Bash Limpbutt's Oozing Cyst© on Sep 16, 2011 Reply

    The winnings are added to your other income for the year. If too much tax was withheld, the excess will be refunded when you file your return. If not enough was withheld (a certainty on a major win) you’ll have to cover that when you file. Depending upon the facts and circumstances there may be penalties for underpayment of tax if you don’t fall into one of the safe harbor exceptions.

    The taxes that are withheld are no different from the taxes that are withheld from your wages. It’s not as if you are “paying twice” but when you pay what you actually owe.

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  5. acmeraven on Sep 16, 2011 Reply

    The money withheld is like that which is withheld from your paycheck and reported to you on your W-2 form. When you file your return for the year the amount withheld you place on the proper line in amounts withheld and credited; so if too much is taken out you get it refunded and etc.. No, you don’t get dinged twice.

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  6. Bobbie on Sep 16, 2011 Reply

    Not usually but some time depending on your other income and filing status and situation it might be possible that you would have to pay some additional amount of income tax IF the the withheld advance estimated tax payment income should happen to be LESS than your federal income tax $ $ $ $ $ $ amount would be when you get to the page 2 line 44 and 46 FIT $ $ $ $ $ and IF at that time your income tax liability should be LESS than the withheld amount plus any other withheld FIT tax amounts that you may have had that were reported on your W-2 form or 1099 form where you would have the credit for all of the withheld tax on the Line 61 Federal income withheld from forms W-2 and 1099 61 $ $ $ $ $ amount and at that point when every thing has been correctly done you will know if you will qualify for any $ $ $ $ $ amount of a REFUND or If you might owe any additional amount of a income tax liability at that time in your life and would have to send that amount at that time with the signed copy of the income tax return.
    Hope you find the above enclosed information useful. 09/15/2011

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  7. the kid on Sep 16, 2011 Reply

    Only if they didn’t take out enough.

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  8. Judy on Sep 16, 2011 Reply

    Your tax is calculated once, when you your tax return. The amount withheld when they cut the check is applied to that. If the took out too much, you’d get the extra refunded; if they didn’t take out enough, you have to pay the rest.

    It works just like the withholding from your paycheck.

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  9. Max Hoopla on Sep 16, 2011 Reply

    Yes and no. A prepayment of taxes is withheld when you get the money. A 50% stupidity tax is built into the price of a lottery ticket.

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