NJ Tax Court Sides With Lotto Winners In Income Tax Fight

Law360, New York (September 27, 2016, 6:00 PM EDT) -- A New Jersey tax court judge on Monday ruled the state cannot tax annuity payments of a man's $46 million lottery winnings, finding that although a 2009 law allows for gross income taxes on lottery prizes, the state had to live up to its past advertisements of tax-free winnings.

Melvin Milligan had sought refunds of income taxes applied to annuity payments of his lottery winnings for the tax years of 2009 through 2013. He and his wife, Kim Lawton-Milligan, had argued a statute adopted in June 2009 that reversed New Jersey's decadeslong policy of not imposing state gross income tax on...

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