The hype over the National Powerball Lottery is unescapable. Everyone is dreaming of being the fortunate winner that overcame statistical odds to win the National Lottery.
Regardless of who wins the Powerball, there will be an even bigger winner than the Powerball winner. This is guaranteed.
If you thought that Uncle Sam would be the biggest Powerball lottery winner, you guessed correctly.
Marketwatch breaks it down below:
“But let’s not focus on the “winner” here because the real winner of the lottery system is not the person who buys the winning ticket. The real winner is the government, which taxes the winner. The government automatically withholds 25%, but the winner will be bumped into the highest marginal tax bracket in the case of the lump sum. In addition, the player will very likely pay a state tax (usually 4% to 9%) and perhaps even local taxes. While the Powerball will be marketed as a $900 million prize, the actual payout to a winner in, say, Washington D.C., will be only $289.6 million — a full 68% less than advertised.”
25% of the revenue raised through selling lottery tickets goes to fund state programs, 15% to the finance the marketing of the lottery. That is correct, 15% of the money raised through ticket sales is used to market and advertise to get more people to buy lottery tickets. Is it any wonder that the poor in the United States spend 9% of their income on lottery tickets?
There are also 97 taxes in the US tax code that are sources of income for the government in addition to the National Lottery:
- Air Transportation Taxes
- Biodiesel Fuel Taxes
- Building Permit Taxes
- Business Registration Fees
- Capital Gains Taxes
- Cigarette Taxes
- Court Fines
- Disposal Fees
- Dog License Taxes
- Drivers License Fees
- Employer Health Insurance Mandate Tax
- Employer Medicare Taxes
- Employer Social Security Taxes
- Environmental Fees
- Estate Taxes
- Excise Taxes on Comprehensive Health Insurance Plans
- Federal Corporate Taxes
- Federal Income Taxes
- Federal Unemployment Taxes
- Fishing License Taxes
- Flush Taxes
- Food and Beverage License Fees
- Franchise Business Taxes
- Garbage Taxes
- Gasoline Taxes
- Gift Taxes
- Gun Ownership Permits
- Hazardous Material Disposal Fees
- Highway Access Fees
- Hotel Taxes (these are becoming quite large in some areas)
- Hunting License Taxes
- Import Taxes
- Individual Health Insurance Mandate Taxes
- Inheritance Taxes
- Insect Control Hazardous Materials Licenses
- Inspection Fees
- Insurance Premium Taxes
- Interstate User Diesel Fuel Taxes
- Inventory Taxes
- IRA Early Withdrawal Taxes
- IRS Interest Charges
- IRS Penalties
- Library Taxes
- License Plate Fees
- Liquor Taxes
- Local Corporate Taxes
- Local Income Taxes
- Local School Taxes
- Local Unemployment Taxes
- Luxury Taxes
- Marriage License Taxes
- Medicare Taxes
- Medicare Tax Surcharge On High Earning Americans Under Obamacare
- Obamacare Individual Mandate Excise Tax
- Obamacare Surtax On Investment Income
- Parking Meters
- Passport Fees
- Professional Licenses and Fees (another form of taxation)
- Property Taxes
- Real Estate Taxes
- Recreational Vehicle Taxes
- Registration Fees For New Businesses
- Toll Booth Taxes
- Sales Taxes
- Self-Employment Taxes
- Sewer and Water Taxes
- School Taxes
- Septic Permit Taxes
- Service Charge Taxes
- Social Security Taxes
- Special Assessments for Road Repairs or Construction
- Sports Stadium Taxes
- State Corporate Taxes
- State Income Taxes
- State Park Entrance Fees
- State Unemployment Taxes (SUTA)
- Tanning Taxes
- Telephone 911 Service Taxes
- Telephone Federal Excise Taxes
- Telephone Federal Universal Service Fee Taxes
- Telephone Minimum Usage Surcharge Taxes
- Telephone State and Local Taxes
- Telephone Universal Access Taxes
- The Alternative Minimum Tax
- Tire Recycling Fees
- Tire Taxes
- Tolls
- Traffic Fines
- Use Taxes
- Utility Taxes
- Vehicle Registration Taxes
- Waste Management Taxes
- Water Rights Fees
- Watercraft Registration and Licensing Fees
- Well Permit Fees
- Workers Compensation Taxes
- Zoning Permit Fees
Taxes are one of the biggest wealth destroyers out there. In order to have any opportunity or realistic chance at building lasting wealth, we have to have economic efficient strategies when it comes tax planning.
We do not advocate not paying taxes. Please pay the legal amount you owe in taxes every year. There is, however, no legal obligation to leave Uncle Sam a tip.
Everyone can take proactive steps in their wealth strategies to limit and reduce their taxes legally, as well as grow their wealth.
Yours in purpose and prosperity,
M.C Laubscher
