would you take cash or payments on the PB

Reply #62

CASH Only — Thu, 17 Nov 2005 15:55:43 GMT

What's my handle? Enough said.

Reply #61

Chewie — Mon, 17 Oct 2005 15:29:33 GMT

There wont be any need to go into hiding....most of us already are lost souls trying to make ends meet ;)Win a lottery and you will no longer be lost or lonely. The churches and charities will ensure your every moment is filled with pledge requests and recommendations on the path you should follow. Give it all away, and they'll want you to give more.

Reply #60

TheGameGrl — Mon, 17 Oct 2005 03:49:54 GMT

Since being in a group lottery pool at my humble place of employ, its clear that we'll take the CASH. Some folks are already hitting retirement age and dont want to be tied to the meager 30 year payout.With the PB- *IF* our group ever hit the jackpot, its clear we'll barely have enough to call a nest egg. The feds alone with get more then each one of us gets individually when all is said and done.There wont be any need to go into hiding....most of us already are lost souls trying to make ends me... [ More ]

Reply #59

hypersoniq — Mon, 17 Oct 2005 02:41:54 GMT

cash, for me that's the choice (after careful consideration both ways).

Reply #58

Chewie — Sun, 16 Oct 2005 22:50:23 GMT

One nice thing about states like Pennsylvania, you don't have to choose chas or annuity until well after you turn in the ticket. I have no idea of how other states work, but, I do know NY and NJ mandate that you to choose up front, long before you can afford legal or tax advise. To me, that makes Pennsylvania a much more citizen friendly state. Makes you wonder why the legislatures in New York and New Jersey force their citizens to make life long decisions before the fact.

Reply #57

lchoro — Sun, 16 Oct 2005 22:34:57 GMT

This guy took the annuity. The annuity terminates right when he's expected to retire, when he probably starts collecting his government pension.http://www.powerball.com/hotlotto/winners/2005/092105ia.shtml

Reply #56

Chewie — Sun, 16 Oct 2005 21:45:01 GMT

How do you convince a team of lawyers, accountants, and financials advisers to give you advise -- before you have the money? I would think they would be looking out for the con-job. Hi, I won $350 million, come work for me. Will pay you next month; until then do all that work based on trust. By the way, can you loan me a couple of bucks so I can afford the gas to drive to the meetings

Reply #55

instantaccess — Sun, 16 Oct 2005 20:58:06 GMT

I would take cash after i got out of the loney home for going nuts. lol

Reply #54

whitmansm2 — Sun, 16 Oct 2005 13:30:04 GMT

wow!I was thinking of taking the Annuity. I figured it would be easier to manage and I'd still be able to live the high life . Taking the lump sum would mean more people touching your money before you get it, like someone else stated. I was just worried about pulling a Jack . lolNow that you all totally confused me, lol, I KNOW before I claim the money I'm going to go and hire an advisor! (I knew it before, but now it's the first thing!)I've never been good with math, but after listening... [ More ]

Reply #53

hsvscubaski — Sun, 16 Oct 2005 13:09:43 GMT

Federal Bonds are not taxable at state and local level. However if you buy an AL tax free and live in NY it would be subject to State and local. Bond mature which means they pay back the principle at maturity. Intersest is paid monthly or quarterly. (If not it is whats known as a zero cupon bond) There is a technique called laddering where you buy bond with different maturities so you are not putting all your eggs in one basket

Reply #52

hsvscubaski — Sun, 16 Oct 2005 12:57:29 GMT

The pentalties would probably not kick in because there are safety nets. If you have had withheld an amount equal to your last year tax bill or in some cases 110% there is no penalty the way I understand it. Keep your money working for you until April 15th when the imperial federal government puts a gun to your head and takes it!!!!!!! Also consult a tax lawer and accountant

Reply #51

hsvscubaski — Sun, 16 Oct 2005 12:48:17 GMT

an additional thought if you live in a state with income tax the are going to take 5% on lump sum. If you take the annuity you could pay the 5% on the 1st annuity pay and then move to a state with no income tax such as TN TX FL NV. Can any one tell me why the MM Annuity vs cash is 90/53 = little less than 60% and PB is 340/164.4 which is less than 50%.

Reply #50

truecritic — Sat, 15 Oct 2005 02:32:01 GMT

How do people make the assumption that if you are taking the lump sum you are losing the difference between the annuity and the lump sum??? Obviously those people have no idea what they are talking about. The lottery doesn't give you an extra amount if you take the annuity.I don't think anyone here thinks what you stated. There is no extra amount, it is the fact that they state the Jackpot is $290,000,000 and that is the amount you expect. That is the amount that should be paid in cash. U... [ More ]

Reply #49

MADDOG10 — Sat, 15 Oct 2005 02:11:24 GMT

cash...!!! $$$$$$$$$...

Reply #48

Debzo — Sat, 15 Oct 2005 01:36:11 GMT

I would take cash

Reply #47

Bradly_60 — Sat, 15 Oct 2005 01:33:29 GMT

One more interesting fact less than 700 people filed tax returns last year that listed their income higher than $10,000,000. So if you win on Saturday you are going to join a very small elite club. hahaBrad

Reply #46

Bradly_60 — Sat, 15 Oct 2005 01:31:44 GMT

How do people make the assumption that if you are taking the lump sum you are losing the difference between the annuity and the lump sum??? Obviously those people have no idea what they are talking about. The lottery doesn't give you an extra amount if you take the annuity. The lump sum and the annuity start at the same amount, the cash option. The extra is just the interest that is earned buying low yield government treasuries. That is where the difference comes from. And believe me no... [ More ]

Reply #45

sirbrad — Sat, 15 Oct 2005 01:18:08 GMT

I never did like Uncles. But you are right, I worry about all this when I win tomorrow.

Reply #44

BaristaExpress — Fri, 14 Oct 2005 18:32:47 GMT

Chewie, get with the program! It was only meant as an example for Shawnintennesse's comment I also stated your taxed every year you have it.. I know I wouldn't do such thing! And I will keep Uncle Sam's hands out of my pocket as much as possible if I win! Yes, he'll get his share on the lump sum payout and April 15, but after that he'll play hell getting any more from me at tax time (all legally of course

Reply #43

Chewie — Fri, 14 Oct 2005 17:29:59 GMT

Why would some one win $140M and put it in a safe box some where? To avoid taxes? Don't spend the original dollar (or two on PP) and save the temptation to open the box! Give me a $140M, and uncle can have his taxes. Him and my lawyers and accountants can argue about the percise amount.When the snow falls this year, I wouldn't be where the snow falls. That's all that would matter.

Reply #42

lchoro — Fri, 14 Oct 2005 17:27:30 GMT

Interest on munis are subject to the federal alternative minimum tax, the state income tax, and any local taxes on income. Why obsess on this topic unless you win? Also, you're likely to get hit with the top marginal tax rate regardless of whether you pick cash or annuity with the prizes in the Powerball and the MegaMillions. Lump sum is the simple answer.

Reply #41

Just6ntlc — Fri, 14 Oct 2005 17:16:55 GMT

I would take cash value no matter if I play MM, PB, or CA SLP. People will get lots of money taken away by Uncle Sam if they take payments.

Reply #40

ryanm — Fri, 14 Oct 2005 17:15:22 GMT

Dammit. They need to make tax-free perpetual bonds.

Reply #39

BaristaExpress — Fri, 14 Oct 2005 16:27:42 GMT

Remember the tax-free municipal bonds only mature in the time stated (3 or 5 years) and the interest is paid at the end of that time. So the 4-5% is per-year, but it's compounded. It all depends on the municipal bonds you buy

Reply #38

sirbrad — Fri, 14 Oct 2005 15:55:27 GMT

What about taking the 100 million and putting it into 'tax-free municipal bonds' at a rate between 4 and 5%? Would that be around $4,000,000 a year tax-free income and never have to touch the principal

Reply #37

BaristaExpress — Fri, 14 Oct 2005 15:48:44 GMT

That is 100% Correct Jag331! No Income, No Tax! No Interest, No Tax!No Dividends, No Tax! No Capital Gains, No Tax

Reply #36

JAG331 — Fri, 14 Oct 2005 15:37:38 GMT

It's called Income Tax for a reason. As long as the money is not incoming that year, yer not gonna get taxed on it.

Reply #35

sirbrad — Fri, 14 Oct 2005 15:32:30 GMT

So are you saying that as long as your principle is not accumulating interest, you will never pay taxes on it again? I know I would never use all the principle regardless, but I would most likely want my money to earn interest over time. Heck one could spend hundreds of thousands of their principle a year and never run out anyway, but that would be eating away at it unnecessarily. I was hoping that the interest acquired would cancel out the majority of the tax costs, even if the interest is taxe... [ More ]

Reply #34

BaristaExpress — Fri, 14 Oct 2005 14:52:03 GMT

I also stated your taxed every year you have it.. <<< Wrong You can't be by the IRS! Lets say I have all that money in a safe deposit box! How in Gods name is the IRS going to tax it? They can't! Because I already paid all of the tax on it and put it away as not to earn any dividends! That makes that money non-taxable! Money that has been taxed before that now doesn't earn any dividends/interest can't be taxed again! Heck stick the freaking money in a mattress or in the walls of your home an... [ More ]

Reply #33

sirbrad — Fri, 14 Oct 2005 13:14:22 GMT

With all these high percentage taxes, how long until your windfall dwindles down to practically nothing? I would definitely be talking with a team of advisers...for awhile. Also what is the highest non taxable interest investments out there? U.S. Treasury bonds

Reply #32

sirbrad — Fri, 14 Oct 2005 13:09:21 GMT

Nonetheless, the IRS never has to play the lottery....they win every time someone else does! Lol.

Reply #31

Shawnintennesse — Fri, 14 Oct 2005 13:08:11 GMT

What you just said was wrong is right... I also stated your taxed every year you have it..If your taxed 13% on it. Then your taxed more than once on that money...

Reply #30

BaristaExpress — Fri, 14 Oct 2005 13:05:37 GMT

Theres no way to pay just one time and be done with it. Cause your taxed on that money every year you have it. <<< Wrong You can not be taxed twice on that money, just your additional 13 % in taxes you will owe by April 15 for that tax year!And if you make money with the money. They want some of that too.<< Correct Only if you make money with it (investments or interest) on said money!Then you owe more taxes

Reply #29

Shawnintennesse — Fri, 14 Oct 2005 13:05:07 GMT

I guess it would all depend on the person how much those taxes would be. It would be dependant on investments. If there were IRA's,CD's.If you put portions into those your not taxed on that.I'm sure theres other ways to get around them as well. You would defiantly need a financial adviser.

Reply #28

sirbrad — Fri, 14 Oct 2005 12:59:14 GMT

I was referring to the 25% withheld, and via a lump sum. But that is what I am trying to figure out, how much would those taxes be per year? What percentage? Using say a $100 million lump sum? Would the interest generated be enough to cover the yearly taxes, and taxable interest easily? So as not to lower the principle

Reply #27

Shawnintennesse — Fri, 14 Oct 2005 12:34:53 GMT

Theres no way to pay just one time and be done with it. Cause your taxed on that money every year you have it.And if you make money with the money. They want some of that too..

Reply #26

sirbrad — Fri, 14 Oct 2005 07:45:33 GMT

Of course I would hire professionals, who in their right mind wouldn't? But it seems that your winnings will be going through a lot of hands before you will able to enjoy them, but they try and mask this with false jackpot amounts, lies, and deceit. I just think it is ridiculous that one beats such great odds, only to have a line others taking their slices of the big pie.Some may not think that the constant harassment from the IRS would not be worth the windfall, not to mention everyone else. I... [ More ]

Reply #25

lchoro — Fri, 14 Oct 2005 04:22:25 GMT

If you're going to take the lump sum, it doesn't make much sense to put it back into an annuity. Because of the low interest rates, they're not paying much more than 4-4.5 percent for guaranteed rates. In addition, once you place it in the annuity, you can't take out your principal without suffering heavy surrender charges that range 3 to 8 percent.

Reply #24

dvdiva — Fri, 14 Oct 2005 04:15:55 GMT

Judging from that quote I would hope you would hire a pro after winning. It's 25% withheld. Since the current Federal rate is 35% that would mean you would own 10% later (on April 15). Thus we can see that 35 - 10 is 25. That should be simple math. Since it is very unlikely you will have a lot of deductions the first year the IRS could hit you with penalties for not giving them the full 35% at a quarterly. Since most W2 wage slaves don't have to fill out quarterlies and most of the weathy do the... [ More ]

Reply #23

sirbrad — Fri, 14 Oct 2005 03:57:22 GMT

I am not too sure about how taxes would work for that. Are you saying you would have to pay 35% of your income again after the 25% is withheld? As I said in another thread that is 60%! Say you won $100 million, and after taxes you had about $75 million. Would you then have to give up 35% of that the following April? ($26 million) Is this a one time payment for the taxes, or every year 35%? If so that is a crock of Can you explain in more detail how the taxes are charged, and how much? In my sta... [ More ]

Reply #22

konane — Fri, 14 Oct 2005 01:49:36 GMT

Reply #21

Chewie — Fri, 14 Oct 2005 01:42:36 GMT

You CAN split it.Get the cash. Put half into the same system the state does - they don't have exclusivity to investment companies. The rate may be a little lower, because the investment is lower, but it is the same difference. I have dealt with a lot of rich people and they could find their butt if you placed both their hands on it. It doesn't take a mental giant to make money, it only takes money to make money. Banks are full of people who will help you stay rich; thats how they make their bo... [ More ]

Reply #20

BaristaExpress — Fri, 14 Oct 2005 01:35:33 GMT

I have said it once before and I'll say it again! Why in God's name would anyone take an annuity for? I want my dollars while they are valued as close to a dollar as they can be today. What is meant by that is, the dollars value changes all the time. Today it's worth .76 cents and tomorrow it could be only worth .66 cents, which would you want it to be worth? You see when you take an annuity today the dollar is worth .76 cents. But the dollar could be worth a lot less even 5 years down the road... [ More ]

Reply #19

Chewie — Fri, 14 Oct 2005 01:35:15 GMT

I see no advantage of annuity over cash. Whatever you can make happen with annuity, you can make happen with cash - they both start from the same baseline. The variable from the baseline is the difference. You can chose to have zero control on what happens, sit back and pay whatever fees and taxes the Government dictates, and see a hundred million in tax (close to it) disappear. Or you can get the cash, hire people a zillons times more savy than a civil servant (nothing against them personally

Reply #18

dvdiva — Fri, 14 Oct 2005 01:25:01 GMT

If you think it's only 25% than you would get a rude awaking on the April after winning. Not to mention how the state tax authorities would take it. Every major winner (over 200 million) took cash. Odds are they consulted lawyers before hand. Since I would also take cash and form a diverse trust I would not be in the market for an annuity. If you felt that you can't handle the money or have a relative you know can't handle the money it's far wiser to set up a perpetual annuity for tham rather th... [ More ]

Reply #17

Tenaj — Fri, 14 Oct 2005 01:03:04 GMT

I would choose cash. Get it while the getting is good. You'll never know what can happen. They can go bankrupt or something. I'm financial literate, I think I could handle it.

Reply #16

truecritic — Fri, 14 Oct 2005 00:56:03 GMT

lchoroOops. Should of known that. Actually it is explained at that site as well. Thanks.

Reply #15

hmsoqu — Fri, 14 Oct 2005 00:42:29 GMT

i wish i could spit it, but if i couldn't i'd take the cash

Reply #14

lchoro — Fri, 14 Oct 2005 00:40:55 GMT

The withholding rate of 25 percent is what they're required to withhold from you when you get paid. The top tax rate of 35 percent is what you're required to pay by April 15th when you file your annual return. If less than 35 percent was withheld, you have to send in the difference with your return. For the latest tax rates, check here:http://www.taxpolicycenter.org/TaxFacts/TFDB/TFTemplate.cfm?Docid=367 The state income tax in Virginia is 5.75 percent. Most state have income tax rates above... [ More ]

Reply #13

truecritic — Fri, 14 Oct 2005 00:32:27 GMT

lchoroThe site says 25% Federal (Michigan is 3.9%) so total 28.9%Some States have no tax on lotteries. That would be considerably less than 40%dvdivaSo you are saying you could have enough cash and still buy an annuity to make up the $148 million? Do you have any estimates of the cost of such an annuity

Reply #12

lchoro — Fri, 14 Oct 2005 00:18:08 GMT

On the other hand, rising interest rates will pressure returns on other investments, such as stocks and bonds. Mortgage REITs are down 40% in the last 2 months. A lot of people were buying up REITs for their accounts because they had very high yields.The tax rate issue depends on the size of the annuity payments and how much can be offset with exemptions, tax credits, and deductions in your personal situation. If the prize level were in the area of 100-300K per year, I'd weigh the annuity opti... [ More ]

Reply #11

dvdiva — Fri, 14 Oct 2005 00:01:14 GMT

I think the only people choosing an annuity from the lottery are those not bright enought to figure out that you can purchase your own annuities. It's all about control. If you get your own annuity you control it. If it's the lotteries annuity they control it plus keep all the interest if rates go up. Any surpluses you would keep on your own annuity. It's not like tax rates are going to go down. They are at a historic low (for the last 50 years) now and will only go up to cover the insane amount... [ More ]

Reply #10

lchoro — Thu, 13 Oct 2005 23:49:07 GMT

some additional considerations:1. The top tax rate is roughly 40% including both the federal and state income tax. Because of Powerball's size, the jackpots and the annual annuity payments are probably both going to be taxed at the top rate. Hence there's no significant tax advantage to choosing the annuity. PLUS FOR LUMP SUM.2. The stated interest on the annuity is roughly 4.7 percent. The higher it goes, the more favorable it is to choose the annuity. I think it needs to approach 6 to 6.... [ More ]

Reply #9

truecritic — Thu, 13 Oct 2005 22:14:47 GMT

These are just questions for the discussion. I am in MI and don't play Powerball but the same line of thoughts could be applied to MM.According to the jackpot figures here http://www.usamega.com/powerball-jackpot.htmImportant: All annuity amounts shown are the average amounts a jackpotwinner would receive. Powerball annuity payments are made on anannually-increasing rate schedule Based on the Gross Prize Annuity... [ More ]

Reply #8

weshar75 — Thu, 13 Oct 2005 22:08:54 GMT

I want the cash option.

Reply #7

dvdiva — Thu, 13 Oct 2005 21:46:04 GMT

You would be better off taking the cash then getting your own annuity if you so choose based on your needs.

Reply #6

Shawnintennesse — Thu, 13 Oct 2005 21:21:12 GMT

I want my money where i can control it...Not in someone elses hands gaining intrest...

Reply #5

Chewie — Thu, 13 Oct 2005 20:19:57 GMT

If I chose annuity, I would be saying I trusted the Government to manage my money for the next 30 years. Name one financial effort the Government has ever managed successfully. Think Boston Tunnel Project. They have been managing my Social Security Account since 1954. Any one want to brag on that fisaco? The State of LA and the New Orleans City Government has been managing New Orleans for 100 years. Enough said. Choose cash

Reply #4

Bradly_60 — Thu, 13 Oct 2005 20:07:25 GMT

I respect everyones decision but you are putting yourself in a very disadvantagous situation if you take the annuity. Time Value of Money. Simple as that. I will always take the cash.Brad

Reply #3

destinedtowin — Thu, 13 Oct 2005 19:29:12 GMT

Most likely to take cash. I need to invest in high yeilds. good luck to all who play this Saturday! as alway destinedtowin.

Reply #2

bellyache — Thu, 13 Oct 2005 19:09:47 GMT

I would take cash. I want to invest my money the way I choose.

Reply #1

Todd — Thu, 13 Oct 2005 18:53:57 GMT

Cash here.

would you take cash or payments on the PB

azramsfan — Thu, 13 Oct 2005 18:21:25 GMT

I would want payments over 30 years.