It's an 800,000 dollar prize package that includes a home and a Yukon SUV. How much in taxes? My husband said we'd have to pay roughly a third of the prize amount, about 300,000, just to win. Is this accurate? That's crazy.
How much money would you need to pay taxes for winning the $800,000 HGTV Green Home Sweepstakes?
He's right, pretty close to 1/3. Around $266K for federal, but then could be more for state added to that.
The US tax system is progressive, which means that the more you make, the higher rate you pay.
Reply:If the entire US population actually knew how much we paid in taxes there would be a revolution!!!!!!!!!!!!!!!!!!!!!
Edit: You only keep about 40% of your income. After you consider federal, state, local employment tax. Then sales tax, taxes on gasoline and heating fuel, electricity, cable, phone, taxes thats just a tip of the iceberg on the taxes we pay!!!!
Reply:A minimum 36% for federal taxes (IRS tax rates) plus whatever maximum income tax rate is for your state of residence (which varies by states)