I'm not too sure about people who are winning scratchies or state lotteries, but there is a fairly well-regulated black market among high-stakes gamblers for losing horse-racing (etc.) tickets. You use them to lay off other winnings so that you don't pay tax. I imagine people looking to wash money also have a market for winning tickets.

It's kind of perverse that Americans pay taxes on gambling AT ALL. The rake is already being taxed, so why tax the winners? It's criminal.

Lots of things are taxed in multiple ways. Income tax and sales tax, or employee and employer FICA for instance.

The tax structure should generally be simpler, but choosing to tax or not tax particular activities is hardly criminal, especially if the intent is to reduce the attractiveness of those activities (tobacco and alcohol come to mind, in addition to gambling)

Yeah it’s double dipping. In the U.K. before they abolished taxes on gambling you has the choice at least. Pay the tax on the stake or the take.

Paying them a premium is not precisely accurate.

A $100,000 lottery ticket would in the US involve 30-45k in taxes for an unmarried person.

So I bet it would probably sell for around $75,000 cash up front, which is a decrease from the sticker price.

But if I was the winner, I would treat it as extremely shady and probably just go the legit route for almost any price.

The US banking system easily detects large cash deposits under 10k even into bank accounts, and then confiscates the money.

And I don't really want to keep $75,000 cash in my mattress.

> The US banking system easily detects large cash deposits under 10k even into bank accounts, and then confiscates the money.

so you are conflating two concepts because first you are depositing $75,000 in this example.

and no they don't confiscate it just because of that, they will freeze it because of your poor explanation.

and if your explanation still sucks, the bank will unfreeze it and give you your money but close your account.

it will appear confiscated if you can't accept your account being frozen and argue the point, which will only raise more flags from more people in the institution.

but if your explanation was good, and by good I mean generic, then you won't encounter any problems.

the deposits over $10,000 will be reported to the government, but then its just the government's problem, and if the transaction wasn't actually problematic then you don't have a problem.

He is probably talking about Asset Seizure by government for unexplained income.

and he is also paranoid about it and conflating several concepts

But you're not the winner, and among winners, there are some willing to do the deal for some price.

Even you. For example, you wouldn't want to keep $75K in your mattress. Would you keep $100K? $750K? A million?

Couldn't you use a safe deposit box?