Why is it unprofitable to play the lottery in New York?

Фото: Depositphotos

After winning a multi-million dollar jackpot, residents of New York will receive less money won than residents of other states.

The administration of Governor Cuomo and Mayor De Blasio ensures that the state and the city will receive most of the winnings before the winner sees the money. That's because the state has the highest lottery taxes in the country.

A group of tax monitors came to the conclusion that the state of New York and the city of New York in fact hold the most lot of taxes in the lottery Powerball. The state takes for itself 8,82% of the winnings before the winner sees it, and the city about 3,87% in the form of tax.

This means that if you were one of those lucky ones who won the multi-million dollar jackpot in New York, you would pay about 12,7% tax right away.

New York State officials and city officials do not comment on why they charge the highest taxes.

James Gazzale, a spokesman for the New York State Department of Taxes and Finance, said that a high tax withholding rate applies to lottery winnings over $ 5000.

In October 2017 Mega Millions changed the range of numbers that a player could choose, with the result that the chances of choosing all six numbers were 1 from 302,6 million compared to 1 by 258,9 million in the old format. In addition, the cost of a lottery ticket has grown to $ 2.

The idea was to make it less likely to hit the jackpot in the early stages, thereby increasing the size of the main prize. While it worked.

Americans love to buy lottery tickets. In the 2016 year, they spent over 80 billions of dollars on them. That's more than they spent on movies, video games, music, sports tickets, and books — all together.

According to polls, Americans would react differently to winning a multi-million jackpot:

• 74,8% of respondents would take the entire amount at once, 25,2% would divide the amount into several annual payments;
• 43,4% of respondents would immediately claim a win, 56,6% would wait some time before announcing a win;
• 80,1% of respondents would consult about options for investing money with a lawyer / accountant / financial advisor, 19,9% would decide the fate of the win;
• 90,7% would prefer to remain anonymous if won, 9,3% would publicly announce a win;
• 48,1% of respondents would have quit their jobs if they won; 51.9% would continue to work.
• 63,6% would hire a financial advisor to manage the money, 36,2% would manage the finances on their own.

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