When you win the lottery, do you need to pay taxes immediately?

Answer by  cgroverla (516)

If your lottery winnings are more than $5,000, 25% of the winnings must be withheld for federal income tax. Most states have withholding requirements with lower thresholds.

Answer by  Att4372 (1704)

If you win a large amount (over $1,000), Federal taxes are due for the QUARTER in which you won. Example, for June thru August, pay by Sept 15. In addition, some states require immediate withholding. You can wait until filing date, but you might owe an underpayment penalty.

Answer by  tamarawilhite (17883)

About 40% is withheld in most states automatically. Depending on how much was won, you may owe up to 50% in taxes. That will not be owed until you file taxes for the current year.