Free Site Registration


Mega Millions Winners Will Owe Jackpot of Taxes

Print
Email
Reprints
New York (March 31, 2012)

By Michael Cohn, Accounting Today

The three winners of the record-breaking $656 million Mega Millions lottery jackpot will owe at least 25 percent of their winnings to the Internal Revenue Service.

Lottery officials have identified Maryland, Illinois and Kansas as the states where the winning tickets were bought. As of press time, the names of the winners have not yet been released, but the operators of a 7-Eleven store in Milford Mill, Md., and a Motomart store in Red Bud, Ill., will also be able to claim lucrative bonuses for selling the winning tickets: $500,000 for the Motomart owners and $100,000 for the 7-Eleven owners. The Kansas store has not yet been identified.

Lottery officials called the couple who operate the Motomart in the pre-dawn hours Saturday morning to tell them the good news. Manager Denise Metzger said she screamed and woke up her husband, and residents of the town crowded into their store once it opened to check their tickets.

The three tickets were worth more than $213 million before taxes, if the payout is spread over 26 years, according to Reuters. If winners opt to take a lump sum payment, as many financial planners advise, the winners would be able to claim approximately $105.1 million after taxes.

Lottery winnings of over 25 percent are subject to a federal withholding tax of 25 percent, and that does not count state income taxes. In addition to the three jackpot-winning tickets, three other lucky ticket winners will be able to claim $1 million for getting the right Mega Ball number, and 158 other ticket holders are entitled to $250,000 apiece for picking five out of the six correct numbers.

0 Comments

Be the first to comment on this post using the section below.

Add Your Comments...

Already Registered?

If you have already registered to Accounting Today, please use the form below to login. When completed you will immeditely be directed to post a comment.

 

Follow Accounting Today
Advertisement
Advertisement

Jason Marx on the Challenges and Opportunities Facing Accountants

June 17, 2013

CCH Small Firm Services president Jason Marx talks about the challenges confronting small accounting firms, including regulatory and tax compliance, technology adoption, and do-it-yourself software.

Jennifer Warawa on the 'On-Demand' Accountant

June 14, 2013

Jennifer Warawa, VP of partner programs and channel sales at Sage, discusses how accountants need to communicate more frequently with clients so they become more of an "on-demand" resource.

George Farrah on the Challenges and Opportunities Facing Accountants

June 14, 2013

Bloomberg BNA executive editor of tax and accounting George Farrah discusses how accountants today are dealing with the economy, technology, globalization and practice management.

Amit Jain on Three Key Trends in Accounting

June 13, 2013

Amit Jain of ADP Small Business Services discusses how the accounting firm of tomorrow will be different from accounting firms today.

Advertisement

SLIDE SHOW

What’s in the Lease Accounting Exposure Draft?

June 18, 2013

A quick guide to FASB’s proposed standards from Bloomberg BNA.

20 Trends to Watch

June 16, 2013

New areas of change that accountants should be on the lookout for.

Protecting Clients from Tax-Related Identity Theft

May 31, 2013

Tax-related identity theft is a continuing problem, and a trustworthy tax preparer is an important part of the solution.

10 Simple Revenue Boosters to Start Now

May 28, 2013

Are your prospects choosing another accounting firm just because of price? There are ways to boost your image to earn a premium fee and leave low-price competitors behind.

Tax Season by the Numbers

May 22, 2013

The IRS recently released statistics covering the year to May 10, 2013.

Advertisement
Advertisement
Advertisement