How Much Does Powerball Pay For Matching 3 Numbers
Winning big can be fun especially when it happens unexpectedly. However, sometimes there is another unexpected surprise that some people have not considered. It is of the inevitable grey area of Powerball winning taxation.
You may have won the lottery but the government still wants its fair share. Powerball winners are usually among the highest-paying taxpayers in the United States. Furthermore, since this game can be played around the world even if you are not a United States citizen you are still responsible for the taxes owed.
The amount of tax you are required to pay as a result of winning the lottery depends upon how you receive your money. Some people prefer to have their money sent to them in one lump sum, for a principle amount. Other people prefer to have their lottery payments sent to them annually, along with any interest earned in that year, for a total of 29 years.
Usually the payment for taxes is around a third to a half of the total lottery amount. This amount of tax that is owed depends upon the actual amount of the lottery prize. The larger the amount won the higher of percentage and larger the amount of tax owed.
Regardless of how a lottery is played the rules regarding taxation are always the same. A certain percentage of jackpot winnings are usually paid to both state and federal governments. If you have any questions about the amount of lottery tax you are required to pay you may want to seek professional legal counsel from someone you can trust.
A legal tax professional who is trustworthy is also confident. This person can help you understand all the current tax laws, and they will show you step by step how they figured the amount of tax that you owe. Furthermore, they will have this information on hand for you to view at a moment’s notice if they are truly willing to help you, and are honest.
Another quality to look for in a tax professional would be to make sure hat you find someone who is certified to complete your taxes for you. They will usually have their educational license displayed on a wall in their office. Either that, or you can ask them for it and they will usually present it to you.
If you are seeking tax advice from someone who you know has received the proper training, you will be more likely to receive the information you need. It will be the correct information, and you will then be less likely to have surprises later on-the most dreaded of which would be to endure a tax audit.
You may also be able to figure out how much tax you owe by yourself. There are various websites dedicated to helping people complete their own taxes electronically. Many of these services re offered for a reduced fee. Furthermore, many people have taken advantage of various computer tax software programs, which have helped them.
Usually a certain amount is withheld from your lottery payment immediately. Therefore, come tax time you will not necessarily need to pay the full tax amount. Then, at tax time you would receive a W2-G form, which states the amount of your lottery winnings. Then, the actual tax that you own on your lottery earnings would be figured out.
Since your lottery earnings are treated similar to wages, you will figure your taxes out in a similar way. You would find the appropriate tax form that includes a section for you to report your lottery earnings and you would enter the amount of income earned from playing the lottery.