Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax

I won $5000.00. How much taxes needs to come off the top?

Customer Question
I won $5000.00. How much...
I won $5000.00. How much taxes needs to come off the top?
Submitted: 11 years ago.Category: Tax
Show More
Show Less
Ask Your Own Tax Question
Answered in 11 minutes by:
5/19/2006
Tax Professional: RD, Certified Public Accountant (CPA) replied 11 years ago
RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8,784
Experience: CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
Verified
Is your question related to tax withheld by the giver and net paid to you?

Is it from lottery?
Ask Your Own Tax Question
Tax Professional: RD, Certified Public Accountant (CPA) replied 11 years ago
There are two types of withholding on gambling winnings: (1) regular gambling withholding at 25% (33.33% for certain noncash payments) and (2) backup withholding at 28%. If a payment is already subject to regular gambling withholding, it is not subject to backup withholding.

Regular Gambling Withholding
You may be required to withhold 25% of gambling winnings for federal income tax. This is referred to as regular gambling withholding. Withhold at the 25% rate if the winnings are more than $5,000 and are from:

Sweepstakes,

Wagering pools,

Lotteries, and

Other wagering transactions if the winnings are at least 300 times the amount wagered.

Do not withhold at the 25% rate on winnings from bingo, keno, or slot machines or any other wagering transaction if the winnings are $5,000 or less.

Regular gambling withholding applies to the total amount of gross proceeds (the amount of winnings less the amount wagered), not merely to the amount in excess of $5,000.

Backup Withholding
You may be required to withhold 28% of gambling winnings (including winnings from bingo, keno, and slot machines) for federal income tax. This is referred to as backup withholding. You should backup withhold at the 28% rate if:

The winner does not furnish a correct taxpayer identification number (TIN) and

25% has not been withheld or the winnings are from bingo, keno, or slot machines.

Backup withholding applies to the total amount of the winnings reduced, at the option of the payer, by the amount wagered. This means the total amount, not just the payments in excess of $600, $1,200, or $1,500, is subject to backup withholding at 28%.

Let me know if you have any question.
***@******.***

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases.
Ask Your Own Tax Question
Customer reply replied 11 years ago
Reply to Renu V's Post: I won the $5000.00 by being the 100th nationwide caller. Does the 25% still stand?
Tax Professional: RD, Certified Public Accountant (CPA) replied 11 years ago
25% withholding may not be required in your case since the winning is not more than $5,000 unless you did not provide your SS# ***** them.

Though they do not withhold taxes, they are required to report this winning to the IRS.

Let me know if you have any question.
***@******.***

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases.
Ask Your Own Tax Question
Customer reply replied 11 years ago
Reply to Renu V's Post: No. I am totally responsible for the taxes. That's why I wanted to know how much I have to withhold for next year. I won it by being the 100th nationwide caller. It was a radio contest.
Tax Professional: RD, Certified Public Accountant (CPA) replied 11 years ago
you will be required to include this in your income and pay taxes on it.

Your taxes would depend on your total taxable income, filing status, tax credit etc...

If you can provide some detail,....I can give you an estimate of the tax liability.

Let me know if you have any question.
***@******.***

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases.
Ask Your Own Tax Question
Customer reply replied 11 years ago
Reply to Renu V's Post: I file head of household with 2 dependants. I make $25000.00 a year. I usually file ez form. I never have deductions except for earned income credit for the kids.
Tax Professional: RD, Certified Public Accountant (CPA) replied 11 years ago
Do you claim child tax credits for the dependants (dependents below age 17) ..IS yes...than you will not owe any taxes.

You tax liability on total income ($25000+$5000)after exemption and deductions will be $1400 (aapx.) but you can get $2,000 as child tax credit (for two kids)

So you will not have a tax liability.

Let me know if you have any question.
***@******.***

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases.
RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8,784
Experience: CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
Verified
RD and 87 other Tax Specialists are ready to help you
Ask your own question now
Ask RD Your Own Question
RD
RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8,784
8,784 Satisfied Customers
Experience: CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..

RD is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,310 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,695 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
Suppose my taxable income in 220,000 this year and the tax
Suppose my taxable income in 220,000 this year and the tax rate is X up to 200K, but Y for 200and over, do I pay Y on the full 220K or just that above 200K? … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Under current law a 100,000 taxable income pays $10,365 plus
Under current law a 100,000 taxable income pays $10,365 plus 25% of the amount exceeding $79,400 i.e. about $16,000. Under tax reform will the tax be $25,000? … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
1099-R with distribution code 3. Can I get an earned income credit?
If someone receives a 1099-R with a distribution code 3, can they qualify for earned income credit? The person receives his pension because he became disabled.… read more
Bizhelp
Bizhelp
Certified Public Accountant (CPA)
Bachelor's Degree
638 satisfied customers
Form 1120, cash basis. If Taxes paid to IRS are deductible,
Form 1120, cash basis. If Taxes paid to IRS are deductible, are refunds for overpayment the equivalent of income?… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
723 satisfied customers
Where can I get the Federal income tax regulation? Where can
Where can I get the Federal income tax regulation? … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
If your taxable income is $0 (actually negative) is there a
If your taxable income is $0 (actually negative) is there a penalty for late filing? Do you need to file at all? What is the 2016 filing deadline with an extension?… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,458 satisfied customers
Can i file head of household on my 2016 tax return if my
Can i file head of household on my 2016 tax return if my husband and I were going through a divorce proceeding but he passed away before the divorce was finalized in mid 2016?… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,458 satisfied customers
Living separately but filing jointly with a child dependent.
living separately but filing jointly with a child dependent. While fulfilling all but one requirements for the EIC and CTC, am I entitled for this credit (and child credit as well) when I fail on the … read more
abci168
abci168
Principal
27 satisfied customers
A Form 1041 is filed for a Credit Shelter Trust & shows a
A Form 1041 is filed for a Credit Shelter Trust & shows a loss on the Taxable Income line (Page 1, line 22). Is this loss carried forward?… read more
abci168
abci168
Principal
27 satisfied customers
I qualify for renters credit and am head of household now
ok I qualify for renters credit and am head of household now how and where do I fill out necessary paperwork for 120.00 a year and do I ,or can I receive the credit for the past 2 years? thank you for… read more
abci168
abci168
Principal
27 satisfied customers
FEDERAL INCOME TAX: A SINGLE WOMAN RECEIVES A 2016 FORM W-2
FEDERAL INCOME TAX: A SINGLE WOMAN RECEIVES A 2016 FORM W-2 FROM HER EMPLOYER WITH A TYPO IN THE SOCIAL SECURITY NUMBER. TO DATE THE EMPLOYER HAS NOT PROVIDED A "CORRECTED" FORM W-2. IS THERE AN IRS "… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
I have filed head of household due to being the only income
I have filed head of household due to being the only income and taking care of 5 kids yet I am married yet not together under the same roof do I need to amend my taxes I think I may have gotten wrong … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
13,695 satisfied customers
Undistributed taxable income previously taxed. Have 3
Undistributed taxable income previously taxed. Have 3 shareholders with balances due to them from previous years. Can it be paid all in one year to bring their amounts owing to zero until the next pro… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
I filed my taxes in 2014. I qualified for Earned income
I filed my taxes in 2014. I qualified for Earned income credit so I was suppose to get a refund. They request addition info to verify my claims which I provided and they accepted. Here it is 2017 I ha… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,458 satisfied customers
My daughter filed for head of household and her 17 year old
My daughter filed for head of household and her 17 year old daughter made4 $4000What is the limit on her child's earnings to file as head of household? … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
I have a question related to backup withholding. I am on H1-
I have a question related to backup withholding. I am on H1-B and pay taxes here. Am I exempt from backup withholding or not when exercising the stock options allocated by my employer? … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Can i file for earned income credit for past years 2008 to
can i file for earned income credit for past years 2008 to 2011, I had zero to $600.00 in those years and did not file. I called the I.R.S. to ask a different question and they asked me why i didn't f… read more
Matthew Breecher
Matthew Breecher
President
MBA (Graduate Legal Studies)
285 satisfied customers
This is a hard one. There was backup withholding done on an
This is a hard one. There was backup withholding done on an 1120S who failed to get their W9 to them in time. Now we need to get this money back and I need to know how to claim this refund. I understa… read more
keeperumiami
keeperumiami
Sr Financial & Tax Consultant
Bachelor\u0027s Degree
1 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x