Q&A: I Won $2,500 On A Scratch Off Do I Pay Tax’s?

lottery new york

Question by scetchin: I Won ,500 On A Scratch Off Do I Pay Tax’s?
Below was taking from the www.NyLottery.Org Website Does that mean i dont pay tax’s since it’s under ,000?

The Lottery is required to report and withhold taxes according to the regulations of the Internal Revenue Service and the New York State Department of Tax and Finance.

The current tax withholding rates are:
Required Federal withholding 25%
Federal backup withholding 28%
Federal Non-resident Alien withholding 30%
New York State withholding 8.97%
New York City withholding 3.648%
Yonkers withholding .897%

Legislation was passed that requires the New York Lottery to withhold New York State taxes from taxable prizes over ,000, regardless of the winner’s place of residence. This law became effective October 1, 2000 and can be viewed at www.tax.state.ny.us By law, the New York Lottery is required to withhold past-due child support and prior public assistance received from any Lottery prize of 0 or more.
Also im on probation is that considered a public assisstance no right they mean borrowing money etc.?
so how much is income tax on this? an probation isnt a public assisstance correct?

Best answer:

Answer by In Michigan
Looks that way, but if you owe anything of what they have mentioned then you won’t get anything :-)

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There Are 4 Responses So Far. »

  1. Not at all. This just means that they won’t take taxes out of the lottery payment, and will give you the $2,500. But they still reported the winnings to the IRS.

    When you fill out your tax return, you still need to report the income on your return and you’ll pay taxes then. Make sure to save a few bucks.

    There is no gambling tax. It’s an income tax. The taxes you end up paying relate to your income for the year.

    If you won $5000, and they took out taxes, then it comes time to file, and you had absolutely no other income all year other than the $5,000, you’d probably get it all back as a tax refund anyway.

  2. Are you kidding the government screws everyone for anything, so yes you are going to pay taxes.

  3. You include it in your income when you file next year. However, you can offset it with gambling losses. So keep track of all losing tickets.

  4. They won’t with hold any money for taxes on a prize that small but the income will be reported to the IRS. You’ll get a W2-G with your check to report the income on your taxes and hence pay then, however you can deduct gambling losses from gambling wins so head out to the stores and collect all the losing scratch off tickets that people throw away. If you can collect enough of these losing tickets, you won’t have to pay taxes on the winnings at all. There’s actually a market for losing tickets on ebay.

    I don’t know anything about probation and hopefully never will however I have heard that you pay for the costs involved with your probation so presumably you still owe money to the government for your probation. Probably the best way to find out is to claim your prize and see what happens, worse case scenario is discharging some of your debt which you should be doing anyways.