MORE LIKE THISTax Strategy and PlanningTaxesIf you win the lottery, you may want to hit pause before you buy a yacht. You will almost certainly owe taxes on those winnings, but planning ahead can save you a headache come tax time.How much are taxes on lottery winnings?You don’t have to win the big jackpot to owe lottery taxes. Your winnings are considered taxable and are added to your ordinary income when taxes are calculated. If your earnings are big enough, they can push part of your income into a higher tax bracket, which means you'll pay a higher tax rate on some of your earnings. A large prize, for example, may put part of your income into the 37% tax bracket.The silver lining is that lottery agencies typically withhold 24% of winnings over $5,000 immediately, which could help offset some of the tax burden you may face on your windfall.» Dive deeper: Learn how the lottery worksLottery tax calculatorThe lottery calculator below will help you estimate the amount of tax that may be w...
