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$270M Mega Millions lottery jackpot claimed anonymously

Topic closed. 53 replies. Last post 11 years ago by KY Floyd.

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NY
United States
Member #23835
October 16, 2005
3475 Posts
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Posted: March 19, 2006, 8:36 pm - IP Logged

As far as I know, Lottery regs requiring them to ID winners are more focused on being able to publicize results - not prove they actually paid someone.

 

I would be very interested in having the option to claim as a trust.

 

Maybe one of my fellow LP'ers can clue me in. I sometimes calculate the percentage of the after-tax lump sum vs. advertized JP for Mega Millions - it usually comes in right at or above 45%.

 

According to the article, the winner received a check for 42% of the advertised JP. Does it vary by state to state? I know CA does not charge state income taxes on lottery winnings...maybe OH does? 

Each state has their own individual rules, but there's an excellent chance that you do have the right to claim any prizes as a trust.  Even if the rules require that the name of the winner be released or that the winner attend a press conference you still might be able to remain anonymous. A trust is a legal entity, and therefore has some of the rights and obligations that a person does. Unless the rules prohibit it, the trust can claim the prize, and therefore the trust is the winner. The name of the trust would be released as the winner's name, and any compulsory attendance at a press conference can be satisfied by a trustee. FWIW, requiring a winner's presence at a press conference is a stuid policy, IMHO. They may be able to require the winner's presence, but they can't require the winner to say anything. They also can't prevent the winner from saying whatever they might choose to say.

As far as how much you'd pocket from a jackpot win, it depends on a few things. First, how much is the cash prize? That will vary with interest rates, but right now it's about 58.5% of the advertised annuity value for MM, and about 47.5% for PB.  Second, what kind of deductions will you have and what's your other income for the year? As a practical matter you might as well expect that a jackpot win will be taxed at the maximum rate for federal taxes. A few states exempt winnings from their own lotteries, but in most states you can also expect to pay the maximum state rate as well. If the winning ticket is from another state you can may get to pay taxes to that state as well.

The 45% figure you mention seems to be based on the amountfor MM after the mandatory federal withholdings of 25%, but the odds are you'll owe a lot more that what is withheld. If you're a California resident and win in California you can expect the net would be .585 (cash value) X .65 (amount left after 35% federal tax), or about 38%. If I win in NY I'd lose another 7.7%, so my net would be .585 X .573, about 33.5%. That means that the real jackpot for MM onTuesday is about $25.8 million for you and $22.8 million for me. Ohio's tax is about 7%, so figure the winner will end up with about 34% after filing their return.I was in Vermont the Saturday of the recent  PB jackpot, and If I'd bought a winning ticket I'd have paid a sizable chunk Vermont (maximum rate of about 9%). With the low cash value for PB and taxes to two states  I'd have been looking at something along the lines of .475  X ([1- [.35 + .077 + .09]), or .475 X .483, a pitiful 23%.  Actually it would be a bit more, because deductions should mean not paying the highest rate on the full amount to both states, but it would still be pretty close to a mere 1/4 of the advertised prize.

    rundown99's avatar - cigar

    United States
    Member #567
    August 14, 2002
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    Posted: March 20, 2006, 12:08 am - IP Logged

    Now that's what I call a smart lottery winner!!!!!  I have been saying it all along on this website.... Go to a state where you can be ANONYMOUS !!!!

    Smart lottery winners form trust to claim their winnings.  They send an attorney to the lottery headquarters to claim the prize in trust, so that ONLY the name of the trust is revealed.  And they tell NO ONE, especially relatives.

    If you ever win a lottery and you are single, the only person you should ever marry is someone who was truly in love with you BEFORE you won the jackpot!

      sirbrad's avatar - Lottery-062.jpg
      PA
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      October 6, 2005
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      Posted: March 20, 2006, 2:12 am - IP Logged

      I believe in PA they withold 25%, and no state tax. Nice.

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        United States
        Member #972
        December 30, 2002
        465 Posts
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        Posted: March 20, 2006, 9:16 am - IP Logged

        > With that much money you have nothing to ever fear again.

        Only endless begging, harrassment, moneygrubbing friends and relatives coming out of the woodwork, lawsuits brought by anyone who thinks they can get you to write a check. As an aside, did you ever hear of Patty Hearst, the Getty heir or Jack Whittaker? Did you ever read Dominick Dunne's "Justice" to see how money doesn't always lead to happy endings?  You have nothing to fear financially, but that's not the only type of fear in the world.

        I think all lottery winners should be able to get their checks anonymously without forming a trust. If the lottery agreed to not release my name until 2 years after I won, and then gave only my former address, I might agree with that (under one condition, see below).  This way the lottery would get their publicity, and I would have time to move and plan my new life without tons of people in my face. People who go from zero to millions should have some time to adjust and get their act together.

        But I would only allow the state to use my name for advertising and publicity benefit if I didn't have to pay state taxes on my winnings. If a state charges taxes after lottery tickets have already made them a profit of 50 cents on every dollar, their moneygrubbing ways have lost them the right to profit anymore off of me. 

         

         

         

         

         

         

         

         

         

         

         

          RJOh's avatar - chipmunk
          mid-Ohio
          United States
          Member #9
          March 24, 2001
          19831 Posts
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          Posted: March 20, 2006, 1:23 pm - IP Logged

          Now that's what I call a smart lottery winner!!!!!  I have been saying it all along on this website.... Go to a state where you can be ANONYMOUS !!!!

          Actually there have been several jackpot winners in north-west Ohio claiming their winnings way.  This was the first MegaMillion jackpot claimed that way but several Ohio SuperLotto prizes were claimed that way. Make me think someone or a group in that area has a winning system and don't want to draw attention to themselves.

           * you don't need to buy more tickets, just buy a winning ticket * 
             
                       Evil Looking       

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            Maryland
            United States
            Member #35590
            March 20, 2006
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            Posted: March 20, 2006, 3:00 pm - IP Logged

            It always amazes me how the balls seem to dance around the numbers I have on my ticket.......I'll have for example 22,24,35,37,49 and we'll see 23,25,36,48,50.

            Is there any way that there could be a super computer somewhere calculation which numbers have been selected for the drawing by the players.....then it selects which numbers to draw that will pay out the least amount of funds.

            Two drawings ago I had three of the five numbers and I was within one of each of the other two numbers. I guess I should have zigged when I zagged.....or maybe it wouldn't matter.....because then the balls would knowingly zagged instead of zigging.BashBanana

            Does anyone know if you can use a pen name for media release?

              sirbrad's avatar - Lottery-062.jpg
              PA
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              Posted: March 20, 2006, 3:52 pm - IP Logged

              The Jack scenario is actually a rare case, and the amount of jackpot winners who never have any problems far exceeds the number who does. But of course we do not hear about them, because nothing ever happens to them that is newsworthy. Looks like the Wests are doing just fine. Again, all depends on what type of life you already have created, and where you live. As well as your overall intelligence, and other intangibles in life.

                sirbrad's avatar - Lottery-062.jpg
                PA
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                October 6, 2005
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                Posted: March 20, 2006, 8:19 pm - IP Logged

                Not all store clerks are bad, in fact I have not had any ask me anything relating to my winnings in many years.

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                  NY
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                  Member #23835
                  October 16, 2005
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                  Posted: March 20, 2006, 8:30 pm - IP Logged

                  The Jack scenario is actually a rare case, and the amount of jackpot winners who never have any problems far exceeds the number who does. But of course we do not hear about them, because nothing ever happens to them that is newsworthy. Looks like the Wests are doing just fine. Again, all depends on what type of life you already have created, and where you live. As well as your overall intelligence, and other intangibles in life.

                  The Jack scenario isn't a rare case, it's an extreme case, and there's an important difference.  That we haven't heard anything about the West's or any other particularly lottery winner may just mean they aren't having problems that are newsworthy and come to the attention of the media. Just because most of us don't remember the names of those who won a few months ago doesn't mean the  vultures don't know their names, or their addresses and phone umbers. The only time you're likely to read a story about how the Wests have been hounded by telemarketers, charities and relatives, the millions they may lose togambling or bad investments, or any of the multitude of other probems that can be caused by the money (or not giving the money to people) is if they happen to be cooperative when the media decides to do a story on how winning affected past winners.

                  Money definitely doesn't solve all of your problems. It certainly solves a lot of them, but it also creates some new ones.  For some advice on what to do if you win, and a list of some of the bad things (only the things that have made the papers, of course) that have happened to some previous winners, you could look here: http://www.rotten.com/library/culture/lottery-winners/