Collecting Big Winnings

Reply #34

KY Floyd — Wed, 10 Dec 2008 18:30:55 GMT

How would you feel about being locked into that 0% rate for 20 to 30 years?

The rate on T-bills only got that low because 1. they're extremely safe, 2. they're only for 4 weeks, and even a 5% rate is only 0.4% over 4 weeks. Selling stocks that are sliding and simply preserving your money's value for a month or two isn't a bad idea if you think the alternative is likely to be worse. Selling 1000 shares for $100,000 and buying 1111 shares for $99,990 a month or two later will make you a nice 11... [ More ]

Reply #33

Seachelle — Wed, 10 Dec 2008 15:16:51 GMT

I agree

Reply #32

GamerMom — Wed, 10 Dec 2008 12:17:13 GMT

http://money.aol.com/news/articles/_a/bbdp/interest-on-t-bills-falls-to-zero/272915

yeah i think i'm still sold on the annuity after reading this

Reply #31

s5thomps — Wed, 10 Dec 2008 12:02:21 GMT

I prefer the Internal Rectum Service

Reply #30

DC81 — Sun, 07 Dec 2008 22:02:53 GMT

Armored car seems rather excessive, especially when no one would or should know who you are, well unless you've brought attention to yourself, like by delivering the ticket via armored car. I doubt I'd have any problem driving myself either, I'd just drive how I normally do and not over think it. I sure as hell wouldn't send the ticket by mail. The postal service is usually reliable but that's a rather unneeded risk.

Either way, at this point I'd probably wait until after the new year anyw... [ More ]

Reply #29

KY Floyd — Sun, 07 Dec 2008 07:56:29 GMT

insure it appropriately ? I'd love to see the look on the postal worker's face when they ask if you want additional insurance and you say Yes, for $50 million dollars, please. Unfortunately, the insurance limit on registered mail is only $25,000. Extrapolating the cost for that, sending a $50 million ticket would cost about 60 grand.

When the first really big PB jackpot of 295 million was won about 10 years ago the lawyer who handled the claim sent the ticket by armored car. I've got no idea... [ More ]

Reply #28

justxploring — Sun, 07 Dec 2008 01:31:05 GMT

So true! Driving to the Lottery Office is probably more dangerous than mailing the ticket. (especially in Florida this time of year.

Reply #27

jarasan — Sun, 07 Dec 2008 01:05:40 GMT

Use a return receipt, insure it appropriately, and sign the back of the winning ticket, it'll be pretty safe. It'll definitely be safer than for eg. returning a pair of glasses to Nicole Brown Simpson or being a security guard at the WalMart in LI. NY. before a Christmas sale.

Reply #26

DC81 — Sat, 06 Dec 2008 07:52:47 GMT

*Imagines taking a check worth a monstrous amount of money to a small local bank.*

While the look on their face would be amusing and everything, I dunno if I'd do that. I think the account with the bank that I'd have set up beforehand would need to be a bank that's in the area near the Lottery HQ and hopefully it's a big bank and get to meet whomever is in charge, heh. On the other hand, it doesn't seem like big banks do CDARs. Not like it matters too much since I'd have no intentions in k... [ More ]

Reply #25

djklaugh — Sat, 06 Dec 2008 07:26:05 GMT

Perhaps one of the reasons the big lotteries send checks for lump sum payouts has to do with the FDIC limits on insurance for accounts. Currently the limits are (from the FDIC website)

Deposits at FDIC-insured institutions are insured up to at least $250,000 per depositor until December 31, 2009. On January 1, 2010, FDIC deposit insurance for all deposit accounts except for certain retirement accounts will return to at least $100,000 per depositor. Insurance coverage for certain retirement a... [ More ]

Reply #24

justxploring — Fri, 05 Dec 2008 17:59:34 GMT

I also prefer Direct Deposit. Some companies won't send checks any more by mail. I think the Federal Government only sends Social Security checks by Direct Deposit now, but I'm not 100% positive. It's much safer as long as there aren't any glitches.

Believe me, I hear what you are saying. Without getting too specific, 2 years ago I rolled over my IRA and the insurance company put my entire life savings in the mail. I was shocked and also very angry. Like you, I automatically assumed it would... [ More ]

Reply #23

GamerMom — Fri, 05 Dec 2008 17:42:45 GMT

You are right you said issue a check, not mail it. I guess i just assumed it would be mailed

My paycheck is sent fed ex twice a month. I feel safe with it being sent that way. It's not that a lottery check would be cashed by anyone else, it's that it would get lost or held up in snail mail. Plus you are right, it would be a PITA to try to cash it. Just seems like direct deposit would be manditory.

Reply #22

justxploring — Fri, 05 Dec 2008 17:34:58 GMT

I never said that, only that it takes about 2 weeks to process. Still, getting a check by mail is safe. I totally agree that sending your ticket(s) through the mail is not safe. I've never won millions, so I honestly don't know how it works, but I do know that companies mail large checks all the time.

Anyway, if a check is made out to you, it would be very difficult, if not impossible, for someone else to cash it. I'm guessing that even if you wanted to deposit a million dollar check in your... [ More ]

Reply #21

GamerMom — Fri, 05 Dec 2008 17:24:37 GMT

right but it sounds to me that's only if you mail it to them. Heck i would drive down there and not leave it to chance that it would make it there on it's own.

another reason I would claim this year is to give out my 12K gifts and then I can give out 13k in a few weeks

Reply #20

justxploring — Fri, 05 Dec 2008 17:19:20 GMT

We've had the what year do I pay my tax discussion before. I'm pretty sure if you win after Nov 1 and collect the money in Jan or later, your W2-G form would be for 2009 because it falls within the 60 day period allowed by the IRS. In fact, I'm positive some state sites request that players who win during the last week of the year wait until January to claim their prizes so the payment and the tax forms are issued during the same calendar year.

I do agree with djklaugh to a point. Technicall... [ More ]

Reply #19

DC81 — Mon, 01 Dec 2008 13:34:57 GMT

Well, they might not go up next year after all as Obama with his advisers (who probably don't want their taxes to go up either, heh) seems to be backing off repealing the Bush Tax Cuts and raising taxes, at least for now.

I'd rather take the lump sum since I'm sure that I could at the very least get a 5% yearly return (with or without it compounding and doing so daily) with some low risk, likely diversified investments which is still a lot better than what the annuity with the T-Bills low... [ More ]

Reply #18

KY Floyd — Mon, 01 Dec 2008 06:13:04 GMT

Until you actually go to the Lottery office in your state and turn in a validated ticket .... they do not know who you are!

They don't have to know your name or social security number to know you're the winner. They know when and where the ticket was sold, and the value of the ticket. That allows them to set the money aside for the person who owns the ticket, and that meets the requirements for constructive receipt. The fact that you don't claim what is rightfully yours doesn't mean you aren... [ More ]

Reply #17

djklaugh — Mon, 01 Dec 2008 02:40:09 GMT

Until you actually go to the Lottery office in your state and turn in a validated ticket .... they do not know who you are! They just know there is a winner. The IRS like wise does not know who the winner is or that you are the winner until you present the ticket and fill out paperwork giving your Social Security number. You are taxed on money you receive in a given year and that includes lottery wins. So it is a good idea - if you won a big jackpot this late in the year - to wait until after Ja... [ More ]

Reply #16

JackpotWanna — Mon, 01 Dec 2008 00:50:08 GMT

I agree. I would claim the prize as soon a possible. Paying taxes would be the first thing I'll do on my things to do list.

Reply #15

GamerMom — Sun, 30 Nov 2008 23:31:10 GMT

I would claim it as soon as possible, especially since i plan on taking the annuity. I would also pay my taxes as soon as possible; I couldn't relax on my beach front property until I paid off my debts

Reply #14

Piaceri — Sun, 30 Nov 2008 23:17:40 GMT

I'm pretty sure they settle these jackpots electronically. Especially the ones that require the W2G.

I think I would probably wait until after the new year if it was more than $20k. I keep all my non winning tickets to deduct, just in case. Not that I have 20 thousand loser tickets or anything, lol. It seems that it would be beneficial to have more time for tax planning. I know for a fact that if you claim in January 2009, you don't have to file taxes until April 2010, but you do have to make... [ More ]

Reply #13

GamerMom — Sun, 30 Nov 2008 22:38:56 GMT

they send a check? in the mail? surely you jest?!? I was hoping for a direct deposit when I hit the JP

Reply #12

MaddMike51 — Sun, 30 Nov 2008 22:12:01 GMT

You may be right,but it seems to me that if you won the money in 2008 the IRS would consider it income earned in 2008.I'll let you know for sure after I win Tuesday nights MegaMillion drawing.

Reply #11

mjwinsmith — Sun, 30 Nov 2008 20:58:44 GMT

When Paid

A payment of winnings is considered made when it is paid, either actually or constructively, to the winner. Winnings are constructively paid when they are credited to, or set apart for, that person without any substantial limitation or restriction on the time, manner, or condition of payment. However, if not later than 60 days after the winner becomes entitled to the prize, the winner chooses the option of a lump sum or an annuity payable over at least 10 years, the payment of winni... [ More ]

Reply #10

MaddMike51 — Sun, 30 Nov 2008 20:27:14 GMT

If you won a jackpot in 2008,I think your W2-G would reflect that you won the money in 2008.You would most likely have to pay taxes on the winnings for 2008,even if you didn't receive the money until 2009.The IRS and the state will take out most of the taxes right off the top but you would probably still owe more at tax time.I'd see a tax specialist,just to be safe.

Reply #9

justxploring — Sun, 30 Nov 2008 19:37:00 GMT

Depends on the state and the amount. I believe there have been other threads on this matter. I once read that, in Florida, it takes about 2 weeks to receive a check for the Lotto. I don't see why it takes more than a couple of days, however. They either have the money or they don't!

Some state lottery sites advise winners after Christmas to wait until after Jan 1, since they probably don't have enough time to issue a check. If you win after Nov 1 and collect the money in Jan, you will get a W... [ More ]

Reply #8

charmed7 — Sun, 30 Nov 2008 19:01:37 GMT

Wow wouldn't that be nice at this time of year. But i would wait until the

beginning of the year, simply because you have to report it as added

income. And personally I like to have some sort of plan mapped out

for myself. And with that sum of money you better go with the

BIG DOGS(a attorney) to help u think, because you're going to be so

excited, and proably won't be thinking clearly.

Reply #7

benjya — Sun, 30 Nov 2008 12:22:49 GMT

How long does it take to get your money after you present the winning ticket

Reply #6

DC81 — Sun, 30 Nov 2008 10:01:34 GMT

Weird, I was thinking about this yesterday and was looking for the topic from a couple months ago about this very thing, didn't find it though.

I don't know, it depends on if it's really beneficial to wait until after the New Year for tax reasons, obviously since I'd plan on setting up a Trust or LLC to claim the JP and it will take a little while to do that anyway. But if everything is set up before the end of the year (which is only a month away now) it might be hard to wait. Anyway, it... [ More ]

Reply #5

ambelamba — Sun, 30 Nov 2008 07:23:16 GMT

I'd just keep the ticket in a safe spot and contact a CPA first. I thought about going straight to the lottery office but I changed my mind. (I don't even play lotteries anymore...)

Tax is inevitable and I would share small portions of my winning with my family. (Mom, dad, and two sisters.) The main reason to hire a lawyer is to set up a plan for financial neteggs and preparing for any possible BS lawsuits. If the JP amount is moderate I'd just go to the office with my lawyer, but winning a... [ More ]

Reply #4

justxploring — Sun, 30 Nov 2008 02:04:37 GMT

That's a good idea.

Reply #3

myturn08 — Sun, 30 Nov 2008 02:02:19 GMT

I would wait until next year to claim.. I would legalize a business so that I have more available write-offs for that tax year.

Reply #2

justxploring — Sun, 30 Nov 2008 02:00:00 GMT

Right now I don't think I'd have the time to make plans, so I would probably claim it in January. It wouldn't necessarily be because of taxes, since I'd still need to pay them, but I'd want to talk to a tax specialist anyway, probably an attorney.

You can't hold on to your money until April of 2010 as others have written in past threads. Once you receive your W-2G I believe you need to file your income tax return within a few months. If you make a lot of interest, the IRS requires that you fi... [ More ]

Reply #1

Guru101 — Sun, 30 Nov 2008 00:54:31 GMT

Nope. I'm claiming it the very next lottery business, which could be the very next day. Why? Because I would feel more secure having the money in the bank.

Collecting Big Winnings

Piaceri — Sun, 30 Nov 2008 00:45:16 GMT

If you won a big payout at this time of the year, one that gets reported to the legalized theft department of the government (IRS), would you wait until after the first of January to collect? Why or why not? Does the amount of the winnings make a difference