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Pepperdine University School of Law

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Saturday, March 31, 2012

The Big Winner in Last Night's Mega Millions Drawing: The Tax Man

MegaAccording to press reports, last night's $656 million Mega Millions jackpot works out to a $473 million lump sum payout, or $157.7 million for each of the three winners (from Illinois, Kansas, and Maryland), leaving them with $92.3 million - $94.6 million after-tax (more here):

State

Federal Withholding

State Withholding

Federal  Tax Rate

State Tax Rate

Illinois

25%

5%

35%

5%

Kansas

25%

5%

35%

6.45%

Maryland

25%

9.25%

35%

5.5%

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Comments

Based on these numbers, the feds should increase the withholding to 40% and states to 8%.

Posted by: None | Mar 31, 2012 3:54:21 PM

This is a tax on the poor, because it's primarily the poor who play the lottery!!!

Posted by: Woody | Mar 31, 2012 9:48:41 PM