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Oct 23 USA Mega Millions draw reaches record $1.6 Billion top prize

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  • Oct 27th, 2018 10:00 am
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According to some reports from lottery officials, it looks like the Mega Millions jackpot will be raised this morning to an annuity value of $1 billion.
Join the winning team - the lottery groups have won $57,476 so far this year!
Mario's Lottery Groups Thread
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FYI it is illegal to cross the border into the US with a US lottery ticket, which you have to do in order to claim your prize. Legal to bring it into Canada though.

Does anyone know what taxes are paid to the US if you win and are not a US citizen/legal resident?
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eonibm wrote:
Oct 19th, 2018 1:39 pm
FYI it is illegal to cross the border into the US with a US lottery ticket, which you have to do in order to claim your prize. Legal to bring it into Canada though.

Does anyone know what taxes are paid to the US if you win and are not a US citizen/legal resident?
its 30% plus state tax if there is. NY is like 9%

just safe deposit at a bank in the States before going back to Canada so you can go back and claim your prize if you won
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One of the Group U24 tickets matched 4 out of 6 numbers. Missed winning a half a billion dollars by only 2 numbers.

The good news, the group gets to try again. No one won the Mega Millions on Friday. The jackpot is an estimated U$905 million for the Tuesday draw.
Join the winning team - the lottery groups have won $57,476 so far this year!
Mario's Lottery Groups Thread
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sumtimw0ng wrote:
Oct 19th, 2018 4:41 pm
its 30% plus state tax if there is. NY is like 9%

just safe deposit at a bank in the States before going back to Canada so you can go back and claim your prize if you won
For US citizens/residents it is based on where you live. For NY State it is 8.82% (plus an additional withholding if you live in New York City (3.876%) or Yonkers (1.323%)). I guess for a Canadian the taxes are based on where you bought it which they can determine from the ticket.

The chances of being searched at the border are extremely low but yes that's a good option to avoid that tiny risk. However, if they suspect that you did bring it over the border how are you going to prove you did not if you did not have a safety deposit box or somewhere to leave it in the US pending your win?
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eonibm wrote:
Oct 20th, 2018 10:27 am
For US citizens/residents it is based on where you live. For NY State it is 8.82% (plus an additional withholding if you live in New York City (3.876%) or Yonkers (1.323%)). I guess for a Canadian the taxes are based on where you bought it which they can determine from the ticket.

The chances of being searched at the border are extremely low but yes that's a good option to avoid that tiny risk. However, if they suspect that you did bring it over the border how are you going to prove you did not if you did not have a safety deposit box or somewhere to leave it in the US pending your win?
This is where having a US Post Office Box comes in handy.
If one is close enough to the border to cross to buy tickets, then one is also close enough to make use of a US Post Office Box.
Just mail the ticket to yourself BEFORE you leave the country.
You leave the US... the ticket never does

As for Taxes,

Ya in the US Winnings (any, not just Lottery) are taxable.
Big round numbers... Americans only see about 50% after everything is said & done

Canadians can claim winnings in the USA
But we too get taxed on them at the same rate initially

After that, if you want some of that missing 50% back, you gotta hire a Tax Accountant to make the claim
You’ll still end up leaving a portion in the US for taxes (considerably lower)
And you’ll have to pay the Tax Accountant (A Specialist in US & Cdn Tax Law)
And no doubt you’ll also need a Lawyer (or two)
And it will take some time... but you’ll see more of your actual winnings

Not 100% sure what the tax implications are though once you get the FOREIGN winnings back into Canada
Believe they may not be totally Tax Free like Cdn Winnings are

Anyhow... truly 0.0005 % First World Problem
I encourage any RFDer who ever finds themself in this mess... to let us all know
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The taxes are not as complicated as you are reporting. One of my groups won about $10,000 in the US. The withholding was 30% federal and 5% state. I filed a US tax return and received all of the 30% tax back. The state tax is never returned. A little bit of paper work but no big deal. I was never questioned about carrying the ticket across the border. I have never heard of that law being enforced (if it even is a law).
Join the winning team - the lottery groups have won $57,476 so far this year!
Mario's Lottery Groups Thread
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PointsHubby wrote:
Oct 20th, 2018 10:48 am
Not 100% sure what the tax implications are though once you get the FOREIGN winnings back into Canada
Believe they may not be totally Tax Free like Cdn Winnings are
no tax in Canada. you are also not obligated to report it while filing your income tax
of course, you'll need to declare the gains on interest
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Got my friend down in NYC to get me some. Waiting for the lucky balls to drop Tues!
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sumtimw0ng wrote:
Oct 20th, 2018 12:14 pm
no tax in Canada. you are also not obligated to report it while filing your income tax
of course, you'll need to declare the gains on interest
Your post, inspired me to do a bit more digging.
You are right, NO Cdn Tax implications on foreign winnings... just on any interest you earn from investing them
Krishna noted that Section 40(2)(f) of the Income Tax Act (Canada) frees Canadians from the burden of taxes on a lottery win outside the country, just as Canadians don’t have to pay income tax on Canadian lottery winnings.
https://www.thestar.com/news/gta/2016/0 ... ckpot.html

However, as that linked article states... the majority of US Lotteries give winners a choice of taking a lump sum payment (highly taxed at the front end)
OR to take it as an annual payment over a long period of time... say 10, 20, 25 or 30 years
(Which makes the taxation not quite as painful, as I understand it)
BUT... Cdn Tax Law treats annuities differently than outright lump sum payments for winnings
So doing that would evidently make those winnings taxable in Canada
https://www.theglobeandmail.com/globe-i ... le9132591/

Good to know
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PointsHubby wrote:
Oct 20th, 2018 10:48 am
This is where having a US Post Office Box comes in handy.
If one is close enough to the border to cross to buy tickets, then one is also close enough to make use of a US Post Office Box.
Just mail the ticket to yourself BEFORE you leave the country.
You leave the US... the ticket never does

As for Taxes,

Ya in the US Winnings (any, not just Lottery) are taxable.
Big round numbers... Americans only see about 50% after everything is said & done

Canadians can claim winnings in the USA
But we too get taxed on them at the same rate initially

After that, if you want some of that missing 50% back, you gotta hire a Tax Accountant to make the claim
You’ll still end up leaving a portion in the US for taxes (considerably lower)
And you’ll have to pay the Tax Accountant (A Specialist in US & Cdn Tax Law)
And no doubt you’ll also need a Lawyer (or two)
And it will take some time... but you’ll see more of your actual winnings

Not 100% sure what the tax implications are though once you get the FOREIGN winnings back into Canada
Believe they may not be totally Tax Free like Cdn Winnings are

Anyhow... truly 0.0005 % First World Problem
I encourage any RFDer who ever finds themself in this mess... to let us all know
Yes mail it to yourself and this will be the 1 in a quadrillion times (the odds on winning) that you both win and USPS loses your mail! I wouldn't risk that.

There is no way to get 'some of that missing 50% back'. The tax must be paid so I don't know what 'claim' are you talking about. Elaborate if it's true. Also, you don't need a lawyer unless you want to attempt to have your identity kept secret, which may or may not work depending on the state. You definitely don't need an accountant.

After US tax is paid the balance, if it is a lump sum, can indeed be brought to Canada tax-free. Not sure about the situation if you choose the annuity but I don't care as I'm taking the lump sum. When you get back with your stash don't bother with a wealth manager and just invest in low fee index funds and call it a day. Easy peasy.
Last edited by eonibm on Oct 20th, 2018 6:55 pm, edited 1 time in total.
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sumtimw0ng wrote:
Oct 20th, 2018 12:14 pm
no tax in Canada. you are also not obligated to report it while filing your income tax
of course, you'll need to declare the gains on interest
On interest, dividends and capital gains just like any other investment you have. It's a great time to win given the low USD.
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Mario38 wrote:
Oct 20th, 2018 10:59 am
The taxes are not as complicated as you are reporting. One of my groups won about $10,000 in the US. The withholding was 30% federal and 5% state. I filed a US tax return and received all of the 30% tax back. The state tax is never returned. A little bit of paper work but no big deal. I was never questioned about carrying the ticket across the border. I have never heard of that law being enforced (if it even is a law).
eonibm wrote:
Oct 20th, 2018 1:12 pm
There is no way to get 'some of that missing 50% back'. The tax must be paid so I don't know what 'claim' are you talking about. Elaborate is it's true. Also, you don't need a lawyer unless you want to attempt to have your identity kept secret, which may or may not work depending on the state. You definitely don't need an accountant.
Hmm, seems that somebody is speaking from experience in this case and someone seems to be speculating.
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Conquistador wrote:
Oct 20th, 2018 1:50 pm
Hmm, seems that somebody is speaking from experience in this case and someone seems to be speculating.
Ya... and someone used to work for Customs.
But hey armchair quarterbacks always know more than the coach
:rolleyes:

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