# Question about tax liability on lottery winnings **URL:** \ **Category:** Factual Questions\ **Created:** [August 4, 2013, 8:00pm UTC](https://boards.straightdope.com/t/question-about-tax-liability-on-lottery-winnings/665346 "2013-08-04T20:00:27Z")\ **Posts on this page:** 6\ **Page:** 2
**Author:** ![drachillix](https://avatars.discourse-cdn.com/v4/letter/d/48db29/32.png) [@drachillix](https://boards.straightdope.com/u/drachillix)\ **Post date:** [August 5, 2013, 6:19pm UTC](https://boards.straightdope.com/t/question-about-tax-liability-on-lottery-winnings/665346/21 "2013-08-05T18:19:19Z")
> [@aruvqan](#): > > Ever think of actually calling the IRS? They actually will help out when people have questions like that. I have called occasionally with questions and everybody I have spoken with have been very nice and the information given was very helpful. In addition to accurate answers, they can provide those answers in writing which can save you headaches and penalties later if another IRS employee has a different interpretation of your results. ---
**Author:** ![Duckster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/duckster/32/1244_2.png) [@Duckster](https://boards.straightdope.com/u/Duckster)\ **Post date:** [August 5, 2013, 6:23pm UTC](https://boards.straightdope.com/t/question-about-tax-liability-on-lottery-winnings/665346/22 "2013-08-05T18:23:49Z")
> [@](#): > > All Lottery prizes, regardless of the amount, generally are considered as income by the state and federal government. > > For Traditional products (Scratch-itsSM and Draw games), the Oregon Lottery® is required to report all Traditional product prizes of $600 or more to the Internal Revenue Service, and the Oregon Department of Revenue. For prizes over $5,000, the Lottery is required to withhold 25% for federal taxes, and 8% for state income taxes. > **[404](https://www.oregonlottery.org/404-2/)** ---
**Author:** ![eastcheap](https://avatars.discourse-cdn.com/v4/letter/e/8491ac/32.png) [@eastcheap](https://boards.straightdope.com/u/eastcheap)\ **Post date:** [August 5, 2013, 6:37pm UTC](https://boards.straightdope.com/t/question-about-tax-liability-on-lottery-winnings/665346/23 "2013-08-05T18:37:01Z")
> [@Keeve](#): > > I was pleasantly surprised to see that this link says that the gambling losses go on Line 28, and are NOT subject to the 2% threshold rule. But, of course, you can only deduct an amount up to your winnings. You can’t claim a loss. As for whether or not you need to file a quarterly, it depends on last year’s return and the current witholding situatoin. Generally, though, most people end up overpaying so much that an extra four grand isn’t likely to result in a penalty. Given a choice, I’d as soon have a piddly six-month CD as send money to the IRS. Dunno about Oregon. ---
**Author:** ![samclem](https://avatars.discourse-cdn.com/v4/letter/s/a9a28c/32.png) [@samclem](https://boards.straightdope.com/u/samclem)\ **Post date:** [August 6, 2013, 2:59am UTC](https://boards.straightdope.com/t/question-about-tax-liability-on-lottery-winnings/665346/24 "2013-08-06T02:59:51Z")
> [@dracoi](#): > > So far, everyone has forgotten about Earned Income Credit. Unless the OP has some disqualifier, going from 25k AGI to 29k AGI will reduce the EIC from $1,909 to $1,270 (I’m using 2012’s tables; 2013 will be similar). So not only will there be about $600 of tax, but credits will be reduced by $639, and the total decrease in refund will be $1,239. > > And the real takeaway from my point is this: Go talk to someone who can look at your prior year returns and give you a real answer. You’re correct by my reading. Bummer. Now, he needs to sock aside about $1100. ---
**Author:** ![actualliberalnotoneofthose](https://avatars.discourse-cdn.com/v4/letter/a/e79b87/32.png) [@actualliberalnotoneofthose](https://boards.straightdope.com/u/actualliberalnotoneofthose)\ **Post date:** [August 6, 2013, 3:25am UTC](https://boards.straightdope.com/t/question-about-tax-liability-on-lottery-winnings/665346/25 "2013-08-06T03:25:48Z")
I’m not seeing the issue. “Forgetting the Earned Income Credit” would also mean that the previous estimates of “owing” also neglected the fact that there is NO owing, just a reduction in the refund. Reducing the over-payment would not result in a liability. It’s very likely the with holding will more than cover it, especially when factoring in the refundable credit(s). FWIW, for this very reason I never have any federal taxes with held at all- even though I have to “pay” some every year, in the form of offset against my refundable credits. ---
**Author:** ![aruvqan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/aruvqan/32/2891_2.png) [@aruvqan](https://boards.straightdope.com/u/aruvqan)\ **Post date:** [August 6, 2013, 4:08am UTC](https://boards.straightdope.com/t/question-about-tax-liability-on-lottery-winnings/665346/26 "2013-08-06T04:08:15Z")
_Ahem_ Why not actually contact the tax people, and _ask_ them? You know, go to the source…:rolleyes: [Previous page](https://boards.straightdope.com/t/question-about-tax-liability-on-lottery-winnings/665346.md?page=1)