Arizonans seeking to be awarded $300M lottery payout are getting hit with a $300 million federal tax penalty
AUSTIN, Texas — AUSTIN — More than $300.3 million in federal taxes has been owed to residents in a Texas lottery jackpot for lottery winners.
The federal government says the state of Texas owes $1.3 billion to the winning lottery winner, but that doesn’t mean the state owes money to the winner.
The Texas Lottery Corporation filed the lawsuit on Friday with the U.S. Tax Court in Austin.
The corporation claims it owes the money because it did not properly disclose a provision in its tax-advantaged tax-exemption rules that allowed it to deduct a portion of the jackpot from its federal income taxes.
The money from the jackpots has been distributed to lottery winners since 2010.
In 2012, the lottery company was awarded $200 million in jackpot payments.
The lottery jackpots are often the largest prizes in Texas, with jackpots exceeding $20 million, and the company has said in past years it will distribute between $15 million and $25 million in prizes each year.