"25% of your action" and the high hand jackpot -- story + poll

[bav]

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It should be pretty easy to figure out the % you owe by looking at a tax schedule w/ the income you brought in last year. Even easier if you filled out a return last year.

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Actually, it's downright impossible to figure out until you actually do you taxes with exact numbers if you itemize and deduct gambling loses. How this added W2G income impacts your final tax burden depends on the size of your income and what other deductions you take.

So the only to-the-penny way would be to wait until next April when you do your taxes. Then fire up TurboTax and do them with the W2G income, then do it again without the W2G income. Then you can compute the difference.

On the other hand, if you don't itemize, the W2G income is stuck there, regardless of your losses. How much of that you will pay in taxes depends on your incremental income tax bracket. Income between $30K and $74K is taxed at 25%. The bracket above is 28%, the bracket below is 15%. You probably fall in one of those three. State and local taxes than go on top. Unless your incoming is sitting on the edge of one of the brackets, you can figure it out pretty accurately now.

Or you could have gone the technically correct route of filling out a form 5754 which is designed for EXACTLY this. You fill in your friend's name and SSN and file it with the Feds. It's basically saying "I won this, but it's being shared with him, so make him pay his fair share of the taxes himself". Then you could each do your taxes declaring your 75% share and his 25% share.