For example, if I win $ 1,000,000. 00 from "Who Wants to Be a Millionaire" or the lottery Powerball.
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For example, if I win $ 1,000,000. 00 from "Who Wants to Be a Millionaire" or the lottery Powerball.
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RibeiroW
October 16, 2009 at 6:42 pmTake that amount, minus your standard deduction, personal deductions, dependents, medical expenses, mortgages and a bunch of other deductions you may have. The net of that will fall into a tax bracket. Hard to say exactly without looking at all of your expenses and dependents, etc, etc, but most likely you will be taxed around 30% for federal tax. Again, impossible to determine without looking at the whole picture.
Then, you need to pay the state tax, which is much lower.
But, you will be 70% richer than you were the day before you won it – and that’s the good news.
Bostonian In MO
October 16, 2009 at 7:18 pmIt’s taxed as ordinary income. Since we have a graduated income tax with rates that vary from 10% to 35%, the final tax bite will depend upon your other income. In most cases though you’ll pay a bit less than $350,000 in Federal income taxes, plus whatever tax is assessed by your State if it has an income tax.
Judy
October 16, 2009 at 8:04 pmIt’s taxed as ordinary income, so would be at whatever your bracket is. The top bracket for federal is 35%, and a million dollar win would put you into that bracket, but the actual tax would probably be a little less than 35% because some of it would likely be in lower brackets.
State income tax would depend on where you live.
bud68
October 16, 2009 at 8:19 pmIt is ordinary income.
hatchetr
October 16, 2009 at 8:52 pmthe same amount they take from our paychecks, which is BS if u ask me