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22 N.Y. coworkers' complicated journey to claim $1 million prize

New York LotteryNew York Lottery: 22 N.Y. coworkers' complicated journey to claim $1 million prize
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SYRACUSE, N.Y. — Claiming a big lottery prize is a little more complicated than you might expect, especially if you are splitting the jackpot with a large group.

Step One: Hire an attorney. That was the advice Ray Wills got last month after he learned that he and 21 other Syracuse city workers with whom he regularly plays the lottery had won $1 million in the Dec. 13 Mega Millions drawing.

Wills, an engineering technician who has worked for the city for 10 years, is the group's ringleader. Once he convinced himself they had won — Wills said he rebooted his computer to make sure he was seeing the correct numbers — the first thing he did was call a former winner from Schenectady who also was part of a large group, to ask advice.

Wills also found tips in an online newspaper article, and he sought out representatives of the state lottery and the Internal Revenue Service. Here's how a big group claims its winnings, at least in this case:

1. Form an LLC. The state Gaming Commission, which operates the New York Lottery, will only issue a maximum of 10 checks to winners. Wills needed to split the prize into 22 pieces. So he and the group hired an attorney to create a limited liability company to accept the winnings from the lottery. The LLC, of which Wills is president, will then distribute the money to the 22 members. The company, formed Dec. 23, is called 12 Checks Short LLC.

2. Set up a bank account. Wills established a bank account for the LLC at the Syracuse Fire Department Federal Credit Union, to which the lottery will wire the $661,800 in net winnings a few days from now. The lottery withholds estimated state and federal income taxes from the $1 million prize.

3. Hire an accountant. It might seem simple to divide the winnings by 22, but distributing the money from an LLC is more complicated than that, Wills said. For one thing, the LLC must provide K-1 tax forms to each member of the company showing his or her earnings and how much was withheld for taxes. It's the equivalent of getting a W-2 from your employer.

4. Pay the professionals. Wills said he established an escrow account to pay the lawyer and accountant. He declined to say how much.

5. Disband the LLC. In about two weeks, the lawyer will formally shut down 12 Checks Short LLC, Wills said.

If that sounds like a lot of hoops to jump through, keep in mind they won $1 million, Wills said. "It's laughable to even insinuate that it's work," he said. "They're handing me a million dollars. I have to come up with some paperwork — how hard is that?"

Here are the members of the group:

Lisa Amidon
David Bean
Michael Burns
Alvin Chan
Gregory Coons
Diana Jaramillo-DeCarlo
Odean Dyer
Christopher Ettinger
Kelly Haggerty
Robert Hofmann
Russell Houck
Stacy Jennis
Timothy Jones
Joel Kayser
David Kearney
John Kivlehan
Glen Mihal
Bazlur Rahman
Mary Robison
Gordon Ruckdeschel
Dominic Vacca
Raymond Wills

Thanks to kapla for the tip.

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28 comments. Last comment 10 months ago by Lucky4Life.
Page 1 of 2
mypiemaster's avatar - peace
He who dies with the most toys WINS!!!.

United States
Member #141039
April 2, 2013
722 Posts
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Posted: January 24, 2014, 8:30 am - IP Logged

Real food for thought. Pool participants and players beware.

Seekand ye shall find -Matt. 7:7 ...Ask and ye shall receive -John 16:24 ...Give and it shall be given unto you -Luke 6:38 ...Be careful what you ask for!!! -Mypiemaster 1:1

Having Money Solves Problems That Not Having Money Creates Yes Nod ****John Carlton****

    Jon D's avatar - calotterylogo
    Los Angeles, California
    United States
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    January 5, 2011
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    Posted: January 24, 2014, 9:15 am - IP Logged

    I don't understand this limitation of only issuing 10 checks, or some lotteries only 1 check. Here in CA, they will issue up to 100 checks for group claims.

    Just think of all the hundreds of checks the lottery issues on a daily basis, many only 3 or 4 figures. So really, how much more trouble is it to issue 12 more checks of $30,081 to cover this group?

    Just think of all the waste in the system by the group needing to spend thousands of dollars for administrative overhead to the lawyer and accountant. That's money wasted that could have gone to stimulating the economy in more productive ways. That's part of what's wrong with this country.

      rcbbuckeye's avatar - Lottery-043.jpg
      Texas
      United States
      Member #55889
      October 23, 2007
      3470 Posts
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      Posted: January 24, 2014, 9:19 am - IP Logged

      Texas will issue 1 check to one individual, or one group. So if my group ever wins we would have to create an LLC, or some type of partnership.

      If we win millions...I'm ok with that.

      CAN'T WIN IF YOU'RE NOT IN

      A DOLLAR AND A DREAM (OR $2)

        RedStang's avatar - mustangshow zps61f7119e.jpg
        Dutchess NY
        United States
        Member #121966
        January 21, 2012
        2737 Posts
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        Posted: January 24, 2014, 9:50 am - IP Logged

        I don't understand this limitation of only issuing 10 checks, or some lotteries only 1 check. Here in CA, they will issue up to 100 checks for group claims.

        Just think of all the hundreds of checks the lottery issues on a daily basis, many only 3 or 4 figures. So really, how much more trouble is it to issue 12 more checks of $30,081 to cover this group?

        Just think of all the waste in the system by the group needing to spend thousands of dollars for administrative overhead to the lawyer and accountant. That's money wasted that could have gone to stimulating the economy in more productive ways. That's part of what's wrong with this country.

        Good article. Agree the 10 check limit makes no sense.

          dallascowboyfan's avatar - tiana the-princess-and-the-frog.jpg
          Oklahoma
          United States
          Member #82391
          November 12, 2009
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          Posted: January 24, 2014, 10:05 am - IP Logged

          Congratulation to all the winnersThumbs Up 10 check limit come on NYBang Head

          I Love Pink & Green 1908

            Avatar
            New York, NY
            United States
            Member #13514
            April 7, 2005
            233 Posts
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            Posted: January 24, 2014, 10:06 am - IP Logged

            Well at least he was smart about it.  Congrats to the winners.

              mamamary517's avatar - Lottery-024.jpg
              Brooklyn, NY
              United States
              Member #115857
              August 29, 2011
              66 Posts
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              Posted: January 24, 2014, 10:07 am - IP Logged

              I didn't know about the 10 check limit in NY.  I have a group of 12 and when one or two players leave the group I will not be replacing them.  Instead of the "Lucky 12" I am going to rename the group to be "The Lucky 10"

                CDanaT's avatar - tiger avatar_04_hd_pictures_169016.jpg
                TX
                United States
                Member #121198
                January 4, 2012
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                Posted: January 24, 2014, 11:11 am - IP Logged

                Good article and information, smart group, sound advice....Looks like common sense/good judgment prevailed !
                Congrats on their win.

                Stay Positive, Believe and good things will come your way

                  Avatar
                  Framingham,Ma
                  United States
                  Member #87371
                  February 23, 2010
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                  Posted: January 24, 2014, 11:20 am - IP Logged

                  The reason for the States doing 10 or in my state Mass. 1 is both greed and lazy. the greed part is pay 1 check to group and he has to pay others so alot more in taxes for state ALOT MORE.The lazy is why do work when you don't have to...know any state worker that does anything extra to help regular people LOL there is an IRS form 5754 to which lottery winnings with groups is used,so its not like its something new or states have to do more than print more check the paper work is done for each person to pay his/her own taxes.If the IRS can figure this out funny how the states can't go alone with it unless states want to cheat you out of more of your money.

                    THRIFTY's avatar - darth vader-face.jpeg
                    NEW YORK
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                    April 29, 2010
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                    Posted: January 24, 2014, 11:44 am - IP Logged

                    I play solo. It only takes 1 lottery ticket to win.

                    US Flag 

                    YOU WILL NEVER WIN A LOTTERY JACKPOT IN YOUR LIFETIME.

                      CDanaT's avatar - tiger avatar_04_hd_pictures_169016.jpg
                      TX
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                      January 4, 2012
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                      Posted: January 24, 2014, 11:56 am - IP Logged

                      The reason for the States doing 10 or in my state Mass. 1 is both greed and lazy. the greed part is pay 1 check to group and he has to pay others so alot more in taxes for state ALOT MORE.The lazy is why do work when you don't have to...know any state worker that does anything extra to help regular people LOL there is an IRS form 5754 to which lottery winnings with groups is used,so its not like its something new or states have to do more than print more check the paper work is done for each person to pay his/her own taxes.If the IRS can figure this out funny how the states can't go alone with it unless states want to cheat you out of more of your money.

                      In Texas, here's a direct quote from the website on making a claim,"The Texas Lottery Commission will pay only one claimant per ticket. A “claimant” can be an individual, a trust, a partnership, a corporation, or any other legal entity.If you choose to claim the prize as a trust, partnership, or other legal entity, the legal documents that create the legal entity must be submitted for review to the Texas Lottery's Legal Services Division before claiming your prize. This is required to ensure the documents comply with the State Lottery Act and the Commission’s administrative rules. If you claim your prize as any entity other than an individual, a Federal Employer Identification Number (FEIN) is required."

                      No multi checks here.  Smiley

                      Stay Positive, Believe and good things will come your way

                        maringoman's avatar - kobold
                        Massachusetts
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                        April 14, 2006
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                        Posted: January 24, 2014, 12:03 pm - IP Logged

                        I think this is great news that 22 co workers walk away with about $30,000 each.

                        It's a futile effort.

                          OldSchoolPa's avatar - Lottery-057.jpg
                          Gurnee, Illinois
                          United States
                          Member #49731
                          February 12, 2007
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                          Posted: January 24, 2014, 12:12 pm - IP Logged

                          I play alone. I think when I win, I will just go in the very next day so I can have that money hit my bank account in 2 weeks time. Then I would setup other accounts after that and transfer funds as need be. I don't care if people know my name since your name has to be disclosed even when claiming in trust or LLC in states that do not permit anonymous prize claim. If things get too unbearable, I would have more than enough money to change my name.

                          Get MONEY!!! Winning a JACKPOT lottery is all the HOPE and CHANGE I desire!!!  NOW give me MONEY!US Flag

                          The guy who won the presidency in 2008 really won the lottery...he is now millions richer, travels in first class style, and even has a staff that would be the envy of the richest Powerball winner (she has a staff of 2). Every night he goes to sleep, he probably plays the close of Dave Chappelle's Show: I'm rich beyatch!

                            CDanaT's avatar - tiger avatar_04_hd_pictures_169016.jpg
                            TX
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                            January 4, 2012
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                            Posted: January 24, 2014, 12:21 pm - IP Logged

                            I play alone. I think when I win, I will just go in the very next day so I can have that money hit my bank account in 2 weeks time. Then I would setup other accounts after that and transfer funds as need be. I don't care if people know my name since your name has to be disclosed even when claiming in trust or LLC in states that do not permit anonymous prize claim. If things get too unbearable, I would have more than enough money to change my name.

                            OS, I might agree with you in most cases until I read this article from an Atty that made a claim for a couple who won $35 million on the MM back in May 2011. His firm is out of Ft.Worth

                            Fort Worth, TX (PRWEB) July 21, 2011 -- In May, the lives of two Texans were changed forever when they won the thirty-five million dollar jackpot in the Mega Millions lottery. Who are these lucky people? Well, unless you are part of their family or circle of closest friends, you are not likely to know. In order to maintain their anonymity and claim their prize, the winners hired attorney Jim Ross to set up a trust and to act as trustee on behalf of that trust.

                             

                            Privacy is very important when you have received a sudden windfall of cash or property, because it takes some time to fully accept and adjust to your new circumstances. As Jim Ross told the Texas Lottery Commission when he claimed the Mega Millions prize for the MAIM Revocable Trust: "The recipients are very excited about this win, and obviously, it's been quite a lifestyle change for them. It's been a fun process dealing with that adjustment."

                            Stay Positive, Believe and good things will come your way