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Bill Would Require Lottery Winners to Pay Back Taxes First
January 8, 2014- Jessica Illuzzi
HARRISBURG – Lottery winners may have to pay back taxes before collecting their prize. A bill is currently moving through the legislature would require anyone who wins more than $2,500 from the Pennsylvania Lottery to use those winnings to pay delinquent state taxes. 

Under the provisions of House Bill 1489, which passed the House Finance Committee unanimously, taxpayers who have outstanding state taxes and have exhausted all appeal rights would have the amount of back taxes they owe deducted from their lottery winnings and paid directly to the Commonwealth.

House Speaker Sam smith (R-Jefferson/Indiana/Armstrong) supports this bill and says, “This is a commonsense piece of legislation that simply requires lottery prizewinners to satisfy outstanding public debts first.” 

Current state law already requires back child support to be deducted from lottery winnings. Under House Bill 1489, delinquent child support deductions would take priority over back taxes, but both could be deducted from winnings. 

Additionally, the bill would require the Department of Public Welfare (DPW) to determine if lottery prizewinners are receiving public assistance benefits. If so, DPW would determine if the individual remains eligible for assistance after the lottery winnings are factored in. 

“This measure aims to combat welfare fraud and abuse by making a concerted effort to ensure that public assistance benefits are only being paid to those who truly qualify for them,” Smith said. “I hope to see this bill coming before the House of Representatives early this year.”

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