When you win a sweepstakes, it's essential to understand how much taxes you pay on sweepstakes winnings. Generally, the IRS considers these winnings as taxable income, meaning you could owe federal taxes ranging from 10% to 37%, depending on your total income. Additionally, some states impose their own taxes, which can further affect your winnings. So, when calculating how much taxes you pay on sweepstakes winnings, be sure to account for both federal and state obligations to avoid any surprises during tax season.