As the Mega Millions jackpot grows to a record $540 million, those buying tickets are not the only ones with dreams about what a win could mean. State governments facing hard times understand a local winner would bring a bonus tax to the home state.
The taxes on the lump-sum payment option to any single winner would bring several million dollars of revenue to the state. That revenue in could restore the entire cuts being faced by social services programs, pay for several hundred low-income housing units and help to increase the number of state police.
The sale of ticket has grown to the point that the current jackpot is the highest in the history of the lottery in the US. A lump sum payment for a winner would bring that person almost $400 million if they are the only winner.
States like Rhode Island, with a 5.99 % tax rate would gain over $23 million with the win. Currently the state has a $7.9 million budget and is $22 million short.
Each state sets its own tax rate for the winnings on the lottery. In New York, citizens pay 8.82 percent, but in California and several other states there are no state taxes.
Ohio would also collect $23 million in taxes, a fraction of the $56 billion 2 year budget, while Montana would collect $50 million for an in-state win. The winnings could help with state buildings as well as infrastructure.
In February and March of this year, Rhode Island saw two Powerball wins, one of $336.4 million and the second of $ 60 million. These two wins have brought $17 million that may replace a $20 million bond.
While states cannot depend on lottery winnings, any state where the tickets are sold would be happy to collect the windfall.
Higher Taxes and Tougher Regulations for Oil Drillers – Governor Kasich
John Kasich, Ohio Governor is proposing changes in the way Ohio taxes and regulates oil and gas drilling companies. He wants a comprehensive energy strategy in the country starting with his home state.
Some of the proposed changes, which require approval from the legislature, include disclosure of chemicals used in fracking, higher tax rates for drillers, higher standards for sinking of wells, and new rules on gas gathering lines.
These proposals were released as part of a Mid Biennium Review. The governor also said that he wants a balance between policies that create new investments and jobs and those that protect the environment.
Kasich believes that Ohio can create policies that can be adopted throughout the country.
States like North Dakota, Pennsylvania and Ohio have been forced to review their policies regarding fracking, or hydraulic fracturing. While industry experts say that the method is safe, residents of these states have complained of contamination in their water sources.
Showing the Money
According to the governor’s office, drillers will be required to pay a severance tax of 4 percent, while income tax rates for small businesses and individuals will go down. If enacted into law, the proposals will allow the local government to collect 25,000 dollars for each well. This upfront fee will be used to cover the effects of drilling.
Oil and gas companies like Chesapeake Energy Corporation (CHK), Exxon Mobil Corp and Devon Energy Corp have already started sinking wells in Ohio’s Utica Shale which is estimated to have 15.7 trillion cubic ft of natural gas and five and half billion barrels of crude oil.
I have spent the entire Saturday analyzing my tax returns, both Federal and State, first I did a Joint return with the Federal we came out even that is we do not owe the tax man and he owes us very little, not even enough for a very good bottle of wine. However with the sate that was different we owe almost five hundred dollars, so I decided to evaluate the option of Married Filing Separate, at the back of my mind I know that in the Federal Tax return this is the most expensive option, but there could be savings on the State return.
I allocated all the income between my wife and I, that is whatever income is attached to her social security number belongs to her, then I analyzed the Schedule A deductions, this gets a little tricky, like the mortgage interest expense and Real Estate Taxes is attached to my social security number therefore I had to split those between us. Expenses such as medical, dental, eye glasses we have our separate bills for the year and as faith would have it all the medications are mine. I had to pay special attention to the medical expenses because we are residents of Ohio and there is a credit for medical expenses on Ohio Tax Line 47. Please note there are many good Tax Return software on the market which could have done this automatically, if I had use one like TurboTax it would have taken me a lot less time, but it snowed today and I am confined to the basement of our home.
After refiguring both federal and State, the result shows it would be a very bad idea to file Married Separate for the Federal return, however on the State return was completely different, we both ended up with small refunds instead of a liability of almost five hundred. On our combine return filing joint we had an effective Tax Rate of almost 5% while on the Married Filing Separate return my effective tax rate is 4.5% and hers 3.5% although collectively we have a total higher rate on the Separate returns we did not owe any State Tax as in the Joint Return which has a lower rate.
I was very amazed and I checked it several times, then I logged on to the State of Ohio Tax Web page and entered the information for two separate returns and Walla I was right all that work pays off sometimes it is better to File Married Filing Separate for the State return. Although I am not a Tax Expert I found the process was not that difficult our return was a simple clear cut return with just my wife and I, can I claim the dog?, OH the dog belongs to my youngest child Dang remember a pet is not a dependent.
Chrysler has ambitious plans for Toledo manufacture.
The Chrysler Group is applying for 2011 tax incentives to fund investment of around $356 million in its assembly complex at Toledo. The expanded plant would employ an additional 1,100 people over the next 2 years.
A company announcement stated that investment in the Toledo expansion project is contingent on Detroit state and Toledo city authorities approving tax incentives. A Toledo newspaper has reported that the city supports the project.
Chrysler already has approval by the Ohio Environmental P*rotection Agency to increase annual production at the Toledo plant by 327,000 vehicles. Currently, Dodge Nitro and Jeep Liberty sport utility vehicles are produced at the plant and expansion plans are said to have been prompted by strong global demand for Jeeps.
Analysts consider that a likely scenario would be for Chrysler to manufacture Jeep products for the European market in Toledo, and to manufacture Jeeps for other global markets within the local region. Among the options mentioned by analysts is partnering with a Chinese manufacturer to produce Jeeps in China for the local market.
It is also rumored that Toledo will be used as a production plant for some Alfa Romeo vehicles for sale in the U.S. The Fiat-Chrysler group’s strategy is said to favor a return of the Alfa Romeo brand to North America. Sergi Marchionne, Fiat CEO, is reported to be planning build fuel-efficient motor vehicles and Chrysler has applied for funding from the U.S. Department o*f Energy.
Marcy Kaptur, U.S. Rep. D-Ohio welcomes Chrysler’s Toledo expansion plans and is focused on supporting the group’s DOE loan application.