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Okla. lawmaker aims to stop lottery winners from staying anonymous

Topic closed. 33 replies. Last post 10 years ago by mr twentyone.

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Plano TX
United States
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December 8, 2005
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Posted: October 9, 2006, 11:07 pm - IP Logged

The Delaware Lottery, while allowing anonymous winners, will keep after tax winnings if you have a state judgement against you for back taxes or child support.

If that law passes I say boycott Oklahoma's lottery. That will be easy for me because I don't live anywhere near it. Proposals like this make me want to Puke.

In Delaware, the lottery knows the identity of the winner, but keeps it anomymous. If a trust is created for the lottery winner, the trust official walks into the lottery office on the winner's behalf, and the lottery pays to the trust, which is a legal entity like a corporation. The lottery office has no idea who the actual winner is.....as for legal purposes, it's the trust that's been created.

I believe Delaware and Kansas are the only 2 states that I've heard of that allow winners to remain anomymous. 

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    California
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    Posted: October 10, 2006, 5:43 pm - IP Logged

    tmcdill...there is a third state that allows winners to remain anomymous, Maryland.  This occured with a Mega Millions jackpot winner from July of this year.

    As far as trusts are concerned,  I think there are a few states where you can use this method to keep a winners identity secret:  New Hampshire, Louisiana, Ohio, Oklahoma (for now) and Pennsylvania.  I gathered some of this information from the list of Powerball winners on the Powerball web site.  Ohio is a Mega Millions state that had four winners earlier this year that all used the trust method to claim their prize.

    For those reading this, are there any changes/additions/deletions?  It would be nice to know which states are the ones where a winner can be protected from having to identify themselves.  If anyone knows of any other states where you can remain anomymous, post a reply.  Maybe when one travels to those states you might be inclined to throw a couple extra dollars into the lottery for the upcoming draw(s)!

    As far as California is concerned, it is impossible not to be identified.  The lottery will report your name, the name and location of the place where the ticket was sold and the amount of the prize (including gross amount and net payment, if applicable).  They don't release your hometown, which might be of some help if you win while visiting another part of the state or are from out of state.  You can decline the press conference.  In an interesting twist you can claim your ticket and say that you want to wait to determine your prize option, cash or annuity. (Note: this is not a debate about cash versus annuity, rather a discussion on ways to keep your name out of the news.)   A person did this when claiming a July Super Lotto Plus Jackpot of $110 million.  It has been over 60 days since he made his claim and there hasn't been any public mention made by the lottery if this person took the cash or the annuity. 

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      Plano TX
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      Posted: October 10, 2006, 6:16 pm - IP Logged

      Thanks for the good information.

       

      And I'm not trying to fight, but ALL states allow corporations and trusts formed by the winners to claim lottery prizes. And, you can make all corporations and trusts so that the real owner's names are hidden. 

       

      From the California lottery code:

       

      5. ASSIGNMENT OF PRIZE TO A REVOCABLE TRUST DURING THE LIFE OF
      THE WINNER

      a. During the winner’s lifetime, the winner may assign his or her rights to all or
      a portion of a prize to a qualifying trust which is a revocable living trust
      established by the winner for the benefit of the winner as a beneficiary and
      governed by the laws of the State of California.

       

      And you can always make corporations so that the true owner's names are hidden. But...to the lottery, the trust or corporation is the bearer of the winning ticket.

       

      For example,

       

      I form Winning Corporation in the country of Switzerland, which has super secret laws about privacy.

       

      Winning Corporation owns XYZ Corp in Texas.

      I have XYZ Corp form a trust in Texas. and instruct the bank's trust officer to walk into the lottery headquarters and claim the winning prize.

      Legal, totally hidden, the only downside is a lot of legal paperwork.

       

      Trusts are usually used because you can shield the family from taxes if you die suddenly, and you can keep the winner's name secret.

       

      http://en.wikipedia.org/wiki/Trusts

       

      This is an area that lotterys are sooner or later going to have to deal with, because a lot of people want the winner's names to be public, but states themselves dont have the authority to do by themselves. 

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        California
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        Posted: October 10, 2006, 6:44 pm - IP Logged

        tmcdill...regarding your response, I thought the exact same thing until I came across the following:

        Claimant Status:  Prize winnings may be paid to natural persons or to business entities, including for profit or non-profit corporations and charitable organizations, subject to lottery rules and regulations.  The Director shall have the discretion to require a business entity to provide the name of a natural person to whom the prize winnings may be paid.

        What I think the lottery is referring to in the Assingnment of Prize information outlined above is the  yearly distribution of an annuity payment to a revocable living trust.  I am not a lawyer and like you I don't want to start a fight, but promote a discussion. What I am thinking is the lottery says to claim the prize you have to identify a natural person.  That person can assign their rights to the prize winnings to a revocable living trust.

        Mind you, I hope you are right!  That's why should I win the jackpot one of the first steps would be a visit to a lawyer who could sort through these issues!! 

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          Plano TX
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          Posted: October 10, 2006, 7:03 pm - IP Logged

          tmcdill...regarding your response, I thought the exact same thing until I came across the following:

          Claimant Status:  Prize winnings may be paid to natural persons or to business entities, including for profit or non-profit corporations and charitable organizations, subject to lottery rules and regulations.  The Director shall have the discretion to require a business entity to provide the name of a natural person to whom the prize winnings may be paid.

          What I think the lottery is referring to in the Assingnment of Prize information outlined above is the  yearly distribution of an annuity payment to a revocable living trust.  I am not a lawyer and like you I don't want to start a fight, but promote a discussion. What I am thinking is the lottery says to claim the prize you have to identify a natural person.  That person can assign their rights to the prize winnings to a revocable living trust.

          Mind you, I hope you are right!  That's why should I win the jackpot one of the first steps would be a visit to a lawyer who could sort through these issues!! 

          They'd lose that in court.

           

          The Missouri Lottery just lost a case where they changed the period for online tickets from 1 year to 6 months.

           

          The person had a winning lotto ticket from Missouri and moved out of state. During that time, Missouri changed the time from 1 year to 6 months.

          The winner tried to claim the ticket, but the Missouri Lottery Commission said 'no way, we are the sole maker of rules for the lottery in this state, and we changed the rules'.

           The courts said no, you are not. And gave the Lottery Commission the big thump. Lottery Commissions make lots of rules, but a lot of them arent legal.

          A lot of states dont ask "cash option" or "annuity" because there was an irs ruling a few years ago that said that the winner should get 60 days to decide. Some states dont know about this, but Texas , where I live, specifically said that the IRS ruling doesnt apply to them, and they ignore it. 

          States think they are kings, until you get a federal judge to read the law to them. Most lottery winners dont care, and dont put a lot of forethought into it, I;'m afraid.

           Now, pardon me, I need to run out and buy my Megamillions tickets for tonight still. :)

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            California
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            Posted: October 10, 2006, 7:56 pm - IP Logged

            For the sake of discussion, why do you say they would lose that in court?  The California Lottery says, these are the rules of our game.  If you win you must identfiy yourself.  You can claim it as a corporation, but you must provide the name of a natural person.  Nothing against the law there.  I don't see this to be illegal as long as they enforce the rule to everyone and it doesn't violate any exsiting Federal Law.  Also should you try to fight this all thoughts of being anonymous are out the window.

            The issue you brought up regarding Missouri changing the time to claim a ticket, well it seems like the right answer was given by the court.

            As far as the IRS ruling regarding the 60 day issue, each state took their own approach to the ruling.  Some states (Texas and New York I think) still make you select at the time of purchase.  Other states (Massachusetts for example) make it 60 days from the date of the draw while others (California for one) make it 60 days from the date of your claim.  These are states choosing to apply Federal Laws as they see fit for their residents.  I don't think they are ignoring it or don't know about it, rather they choose to follow the a certain course of action and then set rules for their lottery.  Yes I may be too idealistic!!

            Good luck on your Mega Millions ticket!  If a winner comes from the Plano Texas area, might we see a challange to the lottery regarding staying anonymous? 

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              Posted: October 10, 2006, 10:14 pm - IP Logged

              The Lottery is more fun when, even when you lose, at least you can see who did win (hopefully someone you know and you've been kind to when they were poor!), and it's interesting to read the story behind the ticket purchase i.e. "I just wanted to get a cup of coffee and I played 1 ticket just for the heck of it..." and often the escapades of the winner afterward. If you're afraid of winning then don't play for big jackpots.

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                Delaware
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                Posted: October 10, 2006, 11:24 pm - IP Logged

                South Carolina and North Dakota are also listed on Powerball's site.

                  guesser's avatar - Lottery-017.jpg

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                  Posted: October 10, 2006, 11:52 pm - IP Logged

                  So you name a (paid) legal guardian (lawyer, 'spokesperson') of the trust to take the winnings in his name, he takes his cut (after taxes), and you take the rest from the trust.

                   

                  Or is that not a viable option ? 

                    guesser's avatar - Lottery-017.jpg

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                    Posted: October 10, 2006, 11:57 pm - IP Logged

                    The Lottery is more fun when, even when you lose, at least you can see who did win (hopefully someone you know and you've been kind to when they were poor!), and it's interesting to read the story behind the ticket purchase i.e. "I just wanted to get a cup of coffee and I played 1 ticket just for the heck of it..." and often the escapades of the winner afterward. If you're afraid of winning then don't play for big jackpots.

                    '(hopefully you know and you've been kind to when they were poor!')

                     

                    YOU are the reason folks want to remain anonymous !

                     

                     

                    Thumbs Up

                    Cheers

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                      Delaware
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                      Posted: October 11, 2006, 1:41 am - IP Logged

                      The Lottery is more fun when, even when you lose, at least you can see who did win (hopefully someone you know and you've been kind to when they were poor!), and it's interesting to read the story behind the ticket purchase i.e. "I just wanted to get a cup of coffee and I played 1 ticket just for the heck of it..." and often the escapades of the winner afterward. If you're afraid of winning then don't play for big jackpots.

                      (hopefully someone you know and you've been kind to when they were poor!),

                      And I would tell you where to put your share of the jackpot Evil Smile

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                        NY
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                        Posted: October 11, 2006, 1:01 pm - IP Logged

                        So you name a (paid) legal guardian (lawyer, 'spokesperson') of the trust to take the winnings in his name, he takes his cut (after taxes), and you take the rest from the trust.

                         

                        Or is that not a viable option ? 

                        I'm guessing that wouldn't work. The state wants the name of the winner, not the winner's representative. If you have somebody claim the prize as the winner and then they give the money to you, it will be a gift that's subject to gift taxes and that would be after they had already paid income tax.

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                          NY
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                          Posted: October 11, 2006, 1:13 pm - IP Logged

                          They'd lose that in court.

                           

                          The Missouri Lottery just lost a case where they changed the period for online tickets from 1 year to 6 months.

                           

                          The person had a winning lotto ticket from Missouri and moved out of state. During that time, Missouri changed the time from 1 year to 6 months.

                          The winner tried to claim the ticket, but the Missouri Lottery Commission said 'no way, we are the sole maker of rules for the lottery in this state, and we changed the rules'.

                           The courts said no, you are not. And gave the Lottery Commission the big thump. Lottery Commissions make lots of rules, but a lot of them arent legal.

                          A lot of states dont ask "cash option" or "annuity" because there was an irs ruling a few years ago that said that the winner should get 60 days to decide. Some states dont know about this, but Texas , where I live, specifically said that the IRS ruling doesnt apply to them, and they ignore it. 

                          States think they are kings, until you get a federal judge to read the law to them. Most lottery winners dont care, and dont put a lot of forethought into it, I;'m afraid.

                           Now, pardon me, I need to run out and buy my Megamillions tickets for tonight still. :)


                          Unless the rules violate the law, the lottery commissions can pretty much make whatever rules they want to. Missouri didn't lose the case because they can't change the claim period, they lost because they can't change the rules after the fact. Somebody who bought a ticket when the claim period was one year has one year to make their claim because that's the rule that was in effect when they bought their ticket.

                            guesser's avatar - Lottery-017.jpg

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                            Posted: October 11, 2006, 2:30 pm - IP Logged

                            I'm guessing that wouldn't work. The state wants the name of the winner, not the winner's representative. If you have somebody claim the prize as the winner and then they give the money to you, it will be a gift that's subject to gift taxes and that would be after they had already paid income tax.

                            Yeah, I kinda figured the 'gifting' taxes, etc.

                             

                            Best thing to do:

                             

                            Win.

                            Move.

                            Or actually:

                            Win

                            Disconnect phone 

                            Move

                            Claim winnings. 

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                              Oklahoma
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                              August 19, 2006
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                              Posted: October 12, 2006, 11:30 am - IP Logged

                              It is fun to read about the big winners and it is good advertising for the lottery, but I still believe winners should be allowed to remain anonymous by using a trust.

                               Today is the one year anniversary of the Oklahoma Lottery. The first scratch off tickets were sold on the morning of October 12, 2005, and Pick 3 drawings started the following month.

                               I have enjoyed playing the Oklahoma Lottery for the past year.