Two Ottawa men are splitting a $32 million lottery jackpot after decades of buying tickets together.
"It hasn't sunk in yet," one of the winners, Samir Haddad, said Thursday. "Today, signing some papers, my hands were shaking. When I look at all the zeroes..."
Haddad, 57, and his friend and barber Mike Detorre, 71, were back in Ottawa after taking four limousines and 35 relatives with them to Toronto to pick up their Lotto 6-49 winnings the day before.
Haddad, who installs hardwood flooring, came to Canada from Lebanon in 1969 and has been playing with Detorre since the lottery started in the early 1970s.
Normally, the men split the cost.
But a few weeks ago, Haddad bought the $3 ticket as a tip after a haircut at Detorre's barber shop because he didn't have any change.
"I told Mike that day, I'll splurge — I'll buy it with the Encore."
Haddad returned to the barber shop at Seneca Street and Sunnyside Avenue, blocks from Carleton University, the next Saturday.
"I went to Mike and I gave him heck," Haddad recalled. "I said, 'When are you ever going to call me to say we've won something?' He said, 'It's when you buy the winning ticket.'"
Haddad said he took the ticket back, replayed the numbers — 4, 16, 20, 23, 28, 44 — and left it behind the mirror as he usually did.
On Monday morning, Detorre visited the convenience store in the same building as the barber shop, where he and Haddad bought their tickets on Mondays and Thursdays.
'There was no happy dance'
Preet Sanhu, who owns the shop and is also Detorre's landlady, said Detorre checked his ticket on the instant checker but showed no sign he'd won.
"There was no happy dance," she said, adding that if she won, she would "do a real big dance out there and scream."
By the time Detorre and Haddad next met, they had both checked the numbers.
But Haddad first made Detorre pay for his half of the ticket.
"He gave me $1.50 and I told him, 'Here, you can have $16 million.'"
The two men then went back to work.
Since then, the win has had an impact in his life, Haddad said. At the bank on Thursday, he didn't have to wait in line. He went straight to the manager's office.
Both men said they will share the money with their families.
Maybe the man was in shock when he scanned his ticket or had the good sense to keep his composure. It would be difficult not to shout aloud or do a "happy dance" but that's why I check my numbers online!
Nice story. Wow - 30 years of playing together. So maybe there's hope for me after all! Notice the article says the winning ticket was a replay of a Quick Pick? (wish FL would bring back the 6/49 game)
This is a very sweet story. There is not greed involved. One splurges with $3 dollars and then collets the $1.50 after he realized it was a winning ticket.. what shocked me actually was the 35 relatives!!! I don't know what the taxes are in Ontario but if is cash value that about 8 million before taxes it could be $5 million after taxes which is nice. But geez 35 relatives if they all got 10k each thats an average of 175k for each lotto winner. I only have 3 peple to tell when i when=Mom,Dad & brother. I am not even sure I would do a limo ride but then again i will collect it ina blind trust. I know which law firm and "boutique" financials services company I will be using....I have nt narrowy down which school I will go to find a butler tho. (can you tell I am single with no kids?)
Quote: Originally posted by justxploring on Jul 7, 2008
Maybe the man was in shock when he scanned his ticket or had the good sense to keep his composure. It would be difficult not to shout aloud or do a "happy dance" but that's why I check my numbers online!
Nice story. Wow - 30 years of playing together. So maybe there's hope for me after all! Notice the article says the winning ticket was a replay of a Quick Pick? (wish FL would bring back the 6/49 game)
yes I know. sometimes I replay my quck pic numbers because they are numbers I would never consider playing.
Quote: Originally posted by Trained2beRich on Jul 7, 2008
This is a very sweet story. There is not greed involved. One splurges with $3 dollars and then collets the $1.50 after he realized it was a winning ticket.. what shocked me actually was the 35 relatives!!! I don't know what the taxes are in Ontario but if is cash value that about 8 million before taxes it could be $5 million after taxes which is nice. But geez 35 relatives if they all got 10k each thats an average of 175k for each lotto winner. I only have 3 peple to tell when i when=Mom,Dad & brother. I am not even sure I would do a limo ride but then again i will collect it ina blind trust. I know which law firm and "boutique" financials services company I will be using....I have nt narrowy down which school I will go to find a butler tho. (can you tell I am single with no kids?)
what is a blind trust and why would you set one up?
Quote: Originally posted by Trained2beRich on Jul 7, 2008
This is a very sweet story. There is not greed involved. One splurges with $3 dollars and then collets the $1.50 after he realized it was a winning ticket.. what shocked me actually was the 35 relatives!!! I don't know what the taxes are in Ontario but if is cash value that about 8 million before taxes it could be $5 million after taxes which is nice. But geez 35 relatives if they all got 10k each thats an average of 175k for each lotto winner. I only have 3 peple to tell when i when=Mom,Dad & brother. I am not even sure I would do a limo ride but then again i will collect it ina blind trust. I know which law firm and "boutique" financials services company I will be using....I have nt narrowy down which school I will go to find a butler tho. (can you tell I am single with no kids?)
Sharing with their relatives does not mean equal shares. There is nothing in the story to indicate the others are equal lottery winners.
I'd share with a large group of extended family, too, but most of them would only get one or two percent!
what is a blind trust and why would you set one up?
A blind trust is a trust in which the executors or those who have been given power of attorney have full discretion over the assets, and the trust beneficiaries have no knowledge of the holdings of the trust. Blind trusts are generally used when a settlor (sometimes called a trustor or donor) wishes to keep the beneficiary unaware of the specific assets in the trust, such as to avoid conflict of interest between the beneficiary and the investments. Politicians often place their personal assets (including investment income) into blind trusts, to avoid public scrutiny and accusations of conflicts of interest when they direct government funds to the private sector.
*source: wikipedia
In other words, I think this means that the money is placed in a company's care (trust) to take care of on your behalf. Because the money is in a trust's name and not yours, if someone wanted to sue you, they couldn't make a claim on your winnings because technically, the money doesn't belong to you.
That's my understanding of it. Someone please correct me if I'm worng.
Sounds good to me. (she writes as if she has a law degree. lol) Just keep in mind that Wikipedia is not always 100% correct since it is written by people like us and can be edited. I once asked a lawyer about this subject and that's the answer I got in a nutshell, but I think there are volumes written about trusts and why people create them.
Personally, I would never give another person power over my assets. Blind Trusts have also been used for more sinister reasons. In real estate, many slumlords don't want tenants to know who owns the building so they can't call him up when a rat bites their children. (Some states don't allow this.) Another questionable use of them applies to political donations. Sometimes politicians create them to avoid impropriety. Example: http://www.sptimes.com/2007/01/05/State/Fla_leaders_don_t_all.shtml
When I decide to have my book "LP posts by justxploring" printed for publication, I'll make sure I use proper grammar, punctuation and sentence structure before it is available for sale to the public.
$1.50 for 16 million dollars is a good trade. If Haddad had been cynical he could have denied Detorre his part of the prize since he didn't pay up front.
Quote: Originally posted by Fraserm on Jul 7, 2008
There are no taxes on initial lotto winnings in Canada. They both get 16 million straight to the bank.
You're right Fraser ... it's all tax free. all lottery games are tax free here until you put it in the bank. Also on a side note: if you plan on giving family members money over $50,000 -- you need to have their names on the back of ticket and tell lottery officals how much your are giving them, otherwise they could be taxed after if you simply gave them $1 million.
Quote: Originally posted by Uff Da! on Jul 8, 2008
Sharing with their relatives does not mean equal shares. There is nothing in the story to indicate the others are equal lottery winners.
I'd share with a large group of extended family, too, but most of them would only get one or two percent!
thats true but if relative A got 10k and relative B got 5K and somehow it came up during a conversation Relative B would be jealous and would ask why do you like A more than me? etc. I would treat all equally.
Quote: Originally posted by One2Adore on Jul 8, 2008
A blind trust is a trust in which the executors or those who have been given power of attorney have full discretion over the assets, and the trust beneficiaries have no knowledge of the holdings of the trust. Blind trusts are generally used when a settlor (sometimes called a trustor or donor) wishes to keep the beneficiary unaware of the specific assets in the trust, such as to avoid conflict of interest between the beneficiary and the investments. Politicians often place their personal assets (including investment income) into blind trusts, to avoid public scrutiny and accusations of conflicts of interest when they direct government funds to the private sector.
*source: wikipedia
In other words, I think this means that the money is placed in a company's care (trust) to take care of on your behalf. Because the money is in a trust's name and not yours, if someone wanted to sue you, they couldn't make a claim on your winnings because technically, the money doesn't belong to you.
That's my understanding of it. Someone please correct me if I'm worng.
Hey Mike32 looks like I was misinformed about a blind trust. what i meant is that would collect it anonymously.
Quote: Originally posted by Uff Da! on Jul 8, 2008
Sharing with their relatives does not mean equal shares. There is nothing in the story to indicate the others are equal lottery winners.
I'd share with a large group of extended family, too, but most of them would only get one or two percent!
for clarifcation purposes each person will get 1 or 2 percent? if thats true that 160k (according to no tax canada as one poster stated) per person. and YOU will pay taxed on it. Unless you mean there share the 1 or 2 percent pot
Quote: Originally posted by Trained2beRich on Jul 9, 2008
thats true but if relative A got 10k and relative B got 5K and somehow it came up during a conversation Relative B would be jealous and would ask why do you like A more than me? etc. I would treat all equally.
In my case it would be far clearer than just "coming up in a conversation." I've signed a notorized statement gifting shares in any MM ticket purchased in the next year. In the event of a jackpot win, we'd have to form a legal partnership, corporation or trust with all parties named and the number of shares each would be there for all to see. However, I see absolutely no reason to keep all shares alike. Why should my adult step-grandchildren get as much as my stepchildren? Why should my adult neices and nephews get as much as my brothers and sisters? The younger generation in these cases will inherit whatever amount their parents don't use up in their lifetimes anyway. And we are talking about people of the older generation in their 60s to 80s, some in poor health.
I've also designated a larger percentage to one disabled relative than to her siblings. She has been paralyzed and otherwise in such poor health as to require assisted living facilities for years. Before she got a dime of the money, she'd have to pay back the state for all the years of social benefits. (With less than a jackpot win, she would not have anything left to improve her life now.) And she presently owns nothing of any value. Her siblings, by contrast, all have their homes already paid off. I know my family well enough to know there would be no jealousy that she'd get more than twice what the others got. Some families aren't that way, I know, but I assure you, my relatives are not greedy and each would appreciate whatever they did get. They try to help other relatives who have less than they have as it is, but since none are wealthy, that help is relatively small.
Quote: Originally posted by Trained2beRich on Jul 9, 2008
Hey Mike32 looks like I was misinformed about a blind trust. what i meant is that would collect it anonymously.
Depends on where you live. It's legal in some states to claim your prize as a Blind Trust (not in Florida) Actually, a Blind Trust or LLC can claim a lottery prize in FL but your name, city of residence, the date you won and the amount will still be available to the public.
Quote: Originally posted by Trained2beRich on Jul 9, 2008
for clarifcation purposes each person will get 1 or 2 percent? if thats true that 160k (according to no tax canada as one poster stated) per person. and YOU will pay taxed on it. Unless you mean there share the 1 or 2 percent pot
I'm not sure what you mean here, but since I signed a notarized affidavit gifting shares in any MM ticket I purchase in the next year, the IRS will have verification that it was shares in the one dollar tickets I purchase that was gifted, not a gift given after the win. In the event of a jackpot win, we'd have to form a legal corporation, partnership or trust to claim it for the group. I would not claim it personally. Consequently, I would not be paying income taxes on anyone else's shares. Nor would I have to pay millions of dollars in gift and generation-skipping taxes on it. With little wins, I'd just claim the win and pay the income taxes myself, though, rather than go to the expense of hiring an attorney, and the amount would not be large enough to trigger concerns about gift taxes.
And yes, most of the shares are one or two percent. (From a $32 million jackpot, that would be $320,000 or $640,000 each before taxes. Nothing to sneeze at!) But I saved 70% for myself.
Incidentally, I made the affidavit effective for just one year for a reason - that gives me a periodic chance to change my mind about who gets what. So if someone dies, I'll take them off the list the next year and give what would have been their share directly to their kids instead of having their share go through their estate. And if the one relative goes back to heavy drug use, she'll be taken back off the list! If I should win in that case and she doesn't like that she gets nothing while her brother gets a share, tough! She'll know why.
A Blind Trust is a Trust that you put your money in where you don't want anyone to know that you won a large amount of money or a lottery.
You can put the Trust in you and your spouse Initials or a name made up of part of your last name and your wifes maiden name. A Lawyer will explain if you want a Blind Trust what you can and can't do when you put a name on the Trust. I've seen some with Initials of the family members.
This way relatives, people wanting money won't know you have it or how to reach you to ask for it. You remain anonymous.
I'd just use initials that have nothing to do with my name or anyone's name if I can, they'd would stand for something but only I would probably know since anyone else still wouldn't have a clue even if it reminded them of something that I used them for, they probably don't even remember what they stood for. It would sound like a partnership to anyone who saw the name of the trust.
Damn, 35 relatives... I barely have three people I'd even considering giving a nickle to, let alone 35. I say barely because sometimes my mind changes on a couple of them and I make no promises. No one even knows when or if I play anyway. Unfortunately most of my relatives are the jealous type and will try to take as much as (or as you let them) possible and then tell you to **** off after they're done, they love money too much and would certainly complain if they got less than someone else. Thankfully they won't have to worry about that because they won't even get anything anyway and the three I'd even consider giving money to wouldn't get more than the maximum allowed before the gift tax kicks in. One would get a large portion of their tuition paid for as long as they don't screw up and maintain a good GPA, I don't believe that tuition falls under the gift tax rules. Admittedly the potential deductable for taxes played a role in my deciding that.
I wouldn't give my relatives cash money. You can only give 12 grand without tax implications. I might buy them things like an HDTV but really I would much rather give them gift cards. For example, my parents are not too many years from a civil service retirement. Rather than giving them enough money to retire early (and thus lose benefits and money) I would give them enough on gift cards to buy all of their groceries and clothing so they could use their own money to pay off bills and such. Tax problem solved.
Just keep in mind that tax on gifts is only paid by the giver, not the recipient. Maybe I misunderstood you, but it's not $12,000 total. You can give $12,000 to as many people as you want. So you can write a check for $12,000 to each of your parents without having any effect on their income. You can also pay for medical expenses, including health insurance premiums and education. However, you are only allowed a total exemption of $1 million in your lifetime. You can also give much more than $12,000 to a person in one year if you file the proper forms as long as you don't exceed the lifetime maximum. There are many ways to get around the whole gift tax problem too. Buy a home on the beach and hire your parents to be the caretakers.
Quote: Originally posted by justxploring on Jul 10, 2008
Just keep in mind that tax on gifts is only paid by the giver, not the recipient. Maybe I misunderstood you, but it's not $12,000 total. You can give $12,000 to as many people as you want. So you can write a check for $12,000 to each of your parents without having any effect on their income. You can also pay for medical expenses, including health insurance premiums and education. However, you are only allowed a total exemption of $1 million in your lifetime. You can also give much more than $12,000 to a person in one year if you file the proper forms as long as you don't exceed the lifetime maximum. There are many ways to get around the whole gift tax problem too. Buy a home on the beach and hire your parents to be the caretakers.
where can i confirm this? i always thought it was $10K and that they had to pay but your deal is much sweeter!!
Quote: Originally posted by Sandra Dee on Jul 11, 2008
where can i confirm this? i always thought it was $10K and that they had to pay but your deal is much sweeter!!
Hi, Sandra. I really liked you in Tammy.
There are many sources
(1) Search the LP archives for threads about Gift Tax.
(2) Google the 2 words Gift and Tax.
(3) Go to the IRS official web site and search for info on Gift Tax
It's not that I'm right or wrong - just reporting what the IRS dictates. If you've seen articles that say it is $10,000 then they are old. It used to be $10,000 with a lifetime exemption of $600,000 but it's been increased. Maybe it will increase in 2009 or be repealed altogether in a couple of years. Not that I like any taxation, but gift & estate tax is just plain wrong IMO. The government is saying "Okay, you've done well and want to pass along your wealth to your children. We don't want it to be easy for them, so we're going to impose a big tax."
In any case, unless there is another arrangement, the recipient never has to claim the gift, unless you are talking about income produced from the gift. Once the money or property is transferred, you would need to claim any interest or income. The same goes for estate tax. When someone dies, the taxes are paid by the Trust before the distribution of wealth. Someone can leave you 4 houses or land valued at $1M and, as long as the deceased's total estate is less than $2 million, there are no taxes due on the gift itself. However, once you start collecting rent or you sell them for a profit, you would have to pay taxes. As I've said before, I'm not a CPA or an attorney, but I am familiar with some of these matters. I've also learned a lot on Lottery Post! LOL Of course, whenever this type of wealth is being handled, it is always best to consult with a private banker & attorney who specializes in wealth management.
Regarding the comment I made about paying people for services, we've probably all known weathy people who started businesses and hired their relatives, but just never thought about it when discussing the lottery. I knew a developer who tried to help a woman he was dating. She began working in his office and he paid her $50,000 plus a company car. She basically answered the phones, took messages & typed letters. Doesn't sound like a huge amount of money (hey, I'll take it!) but this was back in the mid 1980s. When his business started to slow down, he told her he had to lower her salary. She quit and filed a lawsuit against him. As the popular quote goes "No good deed goes unpunished."
Hi, time*treat. I was typing when you posted. Yes, I wonder what will happen after 2010. It sounds a bit eerie, but I said to an elderly neighbor not long ago when joking about his money & how he didn't want the government to tax his children .. "Just plan to die in 2010." He had a heart attack & died in April.
BTW, I thought this just impacted estate tax, not gift tax. I agree that the IRS is the best place to learn about any tax law, but not to find out how to avoid paying tax, even if you want to do it legally. I've called the IRS a couple of times in the past when I had a question. The people were very nice & basically just told me what form to use and what I could claim or not claim, but I never had anyone say to me "oh, there's a great loophole a few people have used."
Quote: Originally posted by Trained2beRich on Jul 7, 2008
This is a very sweet story. There is not greed involved. One splurges with $3 dollars and then collets the $1.50 after he realized it was a winning ticket.. what shocked me actually was the 35 relatives!!! I don't know what the taxes are in Ontario but if is cash value that about 8 million before taxes it could be $5 million after taxes which is nice. But geez 35 relatives if they all got 10k each thats an average of 175k for each lotto winner. I only have 3 peple to tell when i when=Mom,Dad & brother. I am not even sure I would do a limo ride but then again i will collect it ina blind trust. I know which law firm and "boutique" financials services company I will be using....I have nt narrowy down which school I will go to find a butler tho. (can you tell I am single with no kids?)
WHAT ARE THE TAXES IN CANADA.....? I AM CANADIAN THERE ARE NO TAXES !
That is a nice story. Congrats to them both!
Maybe the man was in shock when he scanned his ticket or had the good sense to keep his composure. It would be difficult not to shout aloud or do a "happy dance" but that's why I check my numbers online!
Nice story. Wow - 30 years of playing together. So maybe there's hope for me after all!
Notice the article says the winning ticket was a replay of a Quick Pick? (wish FL would bring back the 6/49 game)
This is a very sweet story. There is not greed involved. One splurges with $3 dollars and then collets the $1.50 after he realized it was a winning ticket.. what shocked me actually was the 35 relatives!!! I don't know what the taxes are in Ontario but if is cash value that about 8 million before taxes it could be $5 million after taxes which is nice. But geez 35 relatives if they all got 10k each thats an average of 175k for each lotto winner. I only have 3 peple to tell when i when=Mom,Dad & brother. I am not even sure I would do a limo ride but then again i will collect it ina blind trust. I know which law firm and "boutique" financials services company I will be using....I have nt narrowy down which school I will go to find a butler tho. (can you tell I am single with no kids?)
yes I know. sometimes I replay my quck pic numbers because they are numbers I would never consider playing.
There are no taxes on initial lotto winnings in Canada. They both get 16 million straight to the bank.
what is a blind trust and why would you set one up?
Sharing with their relatives does not mean equal shares. There is nothing in the story to indicate the others are equal lottery winners.
I'd share with a large group of extended family, too, but most of them would only get one or two percent!
A blind trust is a trust in which the executors or those who have been given power of attorney have full discretion over the assets, and the trust beneficiaries have no knowledge of the holdings of the trust. Blind trusts are generally used when a settlor (sometimes called a trustor or donor) wishes to keep the beneficiary unaware of the specific assets in the trust, such as to avoid conflict of interest between the beneficiary and the investments. Politicians often place their personal assets (including investment income) into blind trusts, to avoid public scrutiny and accusations of conflicts of interest when they direct government funds to the private sector.
*source: wikipedia
In other words, I think this means that the money is placed in a company's care (trust) to take care of on your behalf. Because the money is in a trust's name and not yours, if someone wanted to sue you, they couldn't make a claim on your winnings because technically, the money doesn't belong to you.
That's my understanding of it. Someone please correct me if I'm worng.
Sounds good to me.
(she writes as if she has a law degree. lol) Just keep in mind that Wikipedia is not always 100% correct since it is written by people like us and can be edited. I once asked a lawyer about this subject and that's the answer I got in a nutshell, but I think there are volumes written about trusts and why people create them.
Personally, I would never give another person power over my assets. Blind Trusts have also been used for more sinister reasons. In real estate, many slumlords don't want tenants to know who owns the building so they can't call him up when a rat bites their children. (Some states don't allow this.) Another questionable use of them applies to political donations. Sometimes politicians create them to avoid impropriety. Example: http://www.sptimes.com/2007/01/05/State/Fla_leaders_don_t_all.shtml
I include free cheese in all my slums
, but I'd also like to know which states don't permit rats to bite the children. I could save money on cheese. 
When I decide to have my book "LP posts by justxploring" printed for publication, I'll make sure I use proper grammar, punctuation and sentence structure before it is available for sale to the public.
$1.50 for 16 million dollars is a good trade. If Haddad had been cynical he could have denied Detorre his part of the prize since he didn't pay up front.
You're right Fraser ... it's all tax free. all lottery games are tax free here until you put it in the bank. Also on a side note: if you plan on giving family members money over $50,000 -- you need to have their names on the back of ticket and tell lottery officals how much your are giving them, otherwise they could be taxed after if you simply gave them $1 million.
thats true but if relative A got 10k and relative B got 5K and somehow it came up during a conversation Relative B would be jealous and would ask why do you like A more than me? etc. I would treat all equally.
Hey Mike32 looks like I was misinformed about a blind trust. what i meant is that would collect it anonymously.
for clarifcation purposes each person will get 1 or 2 percent? if thats true that 160k (according to no tax canada as one poster stated) per person. and YOU will pay taxed on it. Unless you mean there share the 1 or 2 percent pot
In my case it would be far clearer than just "coming up in a conversation." I've signed a notorized statement gifting shares in any MM ticket purchased in the next year. In the event of a jackpot win, we'd have to form a legal partnership, corporation or trust with all parties named and the number of shares each would be there for all to see. However, I see absolutely no reason to keep all shares alike. Why should my adult step-grandchildren get as much as my stepchildren? Why should my adult neices and nephews get as much as my brothers and sisters? The younger generation in these cases will inherit whatever amount their parents don't use up in their lifetimes anyway. And we are talking about people of the older generation in their 60s to 80s, some in poor health.
I've also designated a larger percentage to one disabled relative than to her siblings. She has been paralyzed and otherwise in such poor health as to require assisted living facilities for years. Before she got a dime of the money, she'd have to pay back the state for all the years of social benefits. (With less than a jackpot win, she would not have anything left to improve her life now.) And she presently owns nothing of any value. Her siblings, by contrast, all have their homes already paid off. I know my family well enough to know there would be no jealousy that she'd get more than twice what the others got. Some families aren't that way, I know, but I assure you, my relatives are not greedy and each would appreciate whatever they did get. They try to help other relatives who have less than they have as it is, but since none are wealthy, that help is relatively small.
Depends on where you live. It's legal in some states to claim your prize as a Blind Trust (not in Florida) Actually, a Blind Trust or LLC can claim a lottery prize in FL but your name, city of residence, the date you won and the amount will still be available to the public.
I'm not sure what you mean here, but since I signed a notarized affidavit gifting shares in any MM ticket I purchase in the next year, the IRS will have verification that it was shares in the one dollar tickets I purchase that was gifted, not a gift given after the win. In the event of a jackpot win, we'd have to form a legal corporation, partnership or trust to claim it for the group. I would not claim it personally. Consequently, I would not be paying income taxes on anyone else's shares. Nor would I have to pay millions of dollars in gift and generation-skipping taxes on it. With little wins, I'd just claim the win and pay the income taxes myself, though, rather than go to the expense of hiring an attorney, and the amount would not be large enough to trigger concerns about gift taxes.
And yes, most of the shares are one or two percent. (From a $32 million jackpot, that would be $320,000 or $640,000 each before taxes. Nothing to sneeze at!) But I saved 70% for myself.
Incidentally, I made the affidavit effective for just one year for a reason - that gives me a periodic chance to change my mind about who gets what. So if someone dies, I'll take them off the list the next year and give what would have been their share directly to their kids instead of having their share go through their estate. And if the one relative goes back to heavy drug use, she'll be taken back off the list! If I should win in that case and she doesn't like that she gets nothing while her brother gets a share, tough! She'll know why.
A Blind Trust is a Trust that you put your money in where you don't want anyone to know that you won a large amount of money or a lottery.
You can put the Trust in you and your spouse Initials or a name made up of part of your last name and your wifes maiden name. A Lawyer will explain if you want a Blind Trust what you can and can't do when you put a name on the Trust. I've seen some with Initials of the family members.
This way relatives, people wanting money won't know you have it or how to reach you to ask for it. You remain anonymous.
I'd just use initials that have nothing to do with my name or anyone's name if I can, they'd would stand for something but only I would probably know since anyone else still wouldn't have a clue even if it reminded them of something that I used them for, they probably don't even remember what they stood for. It would sound like a partnership to anyone who saw the name of the trust.
Damn, 35 relatives... I barely have three people I'd even considering giving a nickle to, let alone 35. I say barely because sometimes my mind changes on a couple of them and I make no promises. No one even knows when or if I play anyway. Unfortunately most of my relatives are the jealous type and will try to take as much as (or as you let them) possible and then tell you to **** off after they're done, they love money too much and would certainly complain if they got less than someone else. Thankfully they won't have to worry about that because they won't even get anything anyway and the three I'd even consider giving money to wouldn't get more than the maximum allowed before the gift tax kicks in. One would get a large portion of their tuition paid for as long as they don't screw up and maintain a good GPA, I don't believe that tuition falls under the gift tax rules. Admittedly the potential deductable for taxes played a role in my deciding that.
HI EVERYONE IM JUST INTRODUCING MYSELF SINCE IM NEW MY NAME IS SHORTMOMA1 BYE BYE!
Welcome to Lottery Post Shortmoma1!
Hi! You're welcome! Bye bye, see you again.
I wouldn't give my relatives cash money. You can only give 12 grand without tax implications. I might buy them things like an HDTV but really I would much rather give them gift cards. For example, my parents are not too many years from a civil service retirement. Rather than giving them enough money to retire early (and thus lose benefits and money) I would give them enough on gift cards to buy all of their groceries and clothing so they could use their own money to pay off bills and such. Tax problem solved.
Just keep in mind that tax on gifts is only paid by the giver, not the recipient. Maybe I misunderstood you, but it's not $12,000 total. You can give $12,000 to as many people as you want. So you can write a check for $12,000 to each of your parents without having any effect on their income. You can also pay for medical expenses, including health insurance premiums and education. However, you are only allowed a total exemption of $1 million in your lifetime. You can also give much more than $12,000 to a person in one year if you file the proper forms as long as you don't exceed the lifetime maximum. There are many ways to get around the whole gift tax problem too. Buy a home on the beach and hire your parents to be the caretakers.
Buy a home on the beach and hire your parents to be the caretakers.
That's an awesome idea!
where can i confirm this? i always thought it was $10K and that they had to pay but your deal is much sweeter!!
No place better for confirmation than ...
http://www.irs.gov/newsroom/article/0,,id=107815,00.html
Just remember, tax law changes and there will be some BIG "change"s in 2010.
Hi, Sandra. I really liked you in Tammy.
There are many sources
(1) Search the LP archives for threads about Gift Tax.
(2) Google the 2 words Gift and Tax.
(3) Go to the IRS official web site and search for info on Gift Tax
It's not that I'm right or wrong - just reporting what the IRS dictates. If you've seen articles that say it is $10,000 then they are old. It used to be $10,000 with a lifetime exemption of $600,000 but it's been increased. Maybe it will increase in 2009 or be repealed altogether in a couple of years. Not that I like any taxation, but gift & estate tax is just plain wrong IMO. The government is saying "Okay, you've done well and want to pass along your wealth to your children. We don't want it to be easy for them, so we're going to impose a big tax."
In any case, unless there is another arrangement, the recipient never has to claim the gift, unless you are talking about income produced from the gift. Once the money or property is transferred, you would need to claim any interest or income. The same goes for estate tax. When someone dies, the taxes are paid by the Trust before the distribution of wealth. Someone can leave you 4 houses or land valued at $1M and, as long as the deceased's total estate is less than $2 million, there are no taxes due on the gift itself. However, once you start collecting rent or you sell them for a profit, you would have to pay taxes. As I've said before, I'm not a CPA or an attorney, but I am familiar with some of these matters. I've also learned a lot on Lottery Post! LOL Of course, whenever this type of wealth is being handled, it is always best to consult with a private banker & attorney who specializes in wealth management.
Regarding the comment I made about paying people for services, we've probably all known weathy people who started businesses and hired their relatives, but just never thought about it when discussing the lottery. I knew a developer who tried to help a woman he was dating. She began working in his office and he paid her $50,000 plus a company car. She basically answered the phones, took messages & typed letters. Doesn't sound like a huge amount of money (hey, I'll take it!) but this was back in the mid 1980s. When his business started to slow down, he told her he had to lower her salary. She quit and filed a lawsuit against him. As the popular quote goes "No good deed goes unpunished."
Hi, time*treat. I was typing when you posted. Yes, I wonder what will happen after 2010. It sounds a bit eerie, but I said to an elderly neighbor not long ago when joking about his money & how he didn't want the government to tax his children .. "Just plan to die in 2010." He had a heart attack & died in April.
BTW, I thought this just impacted estate tax, not gift tax. I agree that the IRS is the best place to learn about any tax law, but not to find out how to avoid paying tax, even if you want to do it legally. I've called the IRS a couple of times in the past when I had a question. The people were very nice & basically just told me what form to use and what I could claim or not claim, but I never had anyone say to me "oh, there's a great loophole a few people have used."
WHAT ARE THE TAXES IN CANADA.....? I AM CANADIAN THERE ARE NO TAXES !
Imagine that huh? WOW