who dream of to win the lottery and change their life in a stroke of luck they must pay close attention, not only to be sure that they have a winning ticket, but because it is important Know the rules if you don't want to miss out on a big chunk of the prize like what happened to a man in North Carolina.
After purchasing a scratch-off ticket for $20, Toy McLeod was excited to discover that he had won a prize of US$2,000,000, That meant he had defied the odds of more than one in 1.8 million, according to the North Carolina lottery.
When it comes to such a large prize, it is necessary to go directly to the lottery offices, which was done on January 2. So had to decide whether he wanted to get the prize as a lump sum or in small installments over 20 years.
His decision was to take the entire prizeand then he had to face the first cut to his US$2,000,000 and he could only take US$1,200,000, meaning that US$800,000 was immediately deducted.
More than a million dollars is still a significant prize, so there would be no major complaint. However, the man later had to face federal and state taxes so, in the end, the amount was reduced even further and In the end he could only take US$858,006according to lottery authorities.
You have to consider taxes if you win the lottery.
Why did a US$2,000,000 prize end up being less than US$900,000?
Lottery rules and taxes on prizes vary by statethat is why it is important to know the conditions in each case to make the best decision if you win a large prize.
The US Internal Revenue Service (IRS) taxes lottery winnings over $5,000 at a rate of 24 percentwhich is why US$800,000 initially had to be subtracted from the US$2,000,000.
After that, it must be considered that taxes by state can also vary depending on the amount. In North Carolina, lottery winners have to pay a 5.25 percent taxalthough it is much lower than in states like New Jersey and New York, where they exceed 8 percent.
And if you want to take most of the prize without having to pay taxes then you have to be lucky in Florida, California, Texas or Wyoming, where there is no tax on lottery winnings.
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