We are retired and managed to hit the lotto in 2023 for $452,886.00 federal was with held $108,692 and mi state tax 19,247 our adjusted gross last year was $22,963 we have saved our loosing lottery tickets for our taxes this year will we need alot??
Dianne
Congratulations on the winning ticket!
"we have saved our loosing lottery tickets "
The "losing" tickets may have no effect at all. Are you going to be itemizing other deductions like mortgage interest, property tax, etc.? If not, the losing tickets have no effect at all.
Gambling winnings are taxable income. Losses are an itemized deduction. If you do not have enough itemized deductions to exceed your standard deduction, your losses will have no effect.
https://blog.turbotax.intuit.com/income-and-investments/how-are-gambling-winnings-taxed-8891/
https://ttlc.intuit.com/questions/1900352-can-i-deduct-my-gambling-losses
2023 STANDARD DEDUCTION AMOUNTS
SINGLE $13,850 (65 or older/legally blind + $1850)
MARRIED FILING SEPARATELY $12,850 (65 or older/legally blind + $1500)
MARRIED FILING JOINTLY $27,700 (65+/legally blind) ) + $1500 per spouse
HEAD OF HOUSEHOLD $20,800 (65 or older/blind) + $1850)
Try using the current Tax caster tool to see how you will stand for your 2023 tax return.
https://turbotax.intuit.com/tax-tools/calculators/taxcaster/
You can only deduct the lottery tickets, including the cost of the winning one, that you bought in 2023.
You must be itemizing.
Be aware that the withholding is only an estimate. Your actual tax is calculated on your tax return, and you get credit for the withholding. If the withholding was too much, you will get a refund, but if the withholding was not enough, you will owe more taxes.
Yes, you can include your provable gambling losses. However, they will only actually help if you are already planning to itemize your deductions, because you have a mortgage, gifts to charity, and other items. Of course, state income tax is one of the itemized deductions, so just with the Michigan withholding alone ($22K+) you are already very close to the threshold for itemized deductions. If you enter all your tax deductions, Turbotax will determine which method results in the lowest taxes.
No