TX winner a potential loser

Reply #10

durango99 — Thu, 05 Sep 2002 20:52:47 GMT

okay lets say a the worst you win the 10million annuity... 5million in cash i believe the tax rate including federal and state and local here in ohio would be around 47.5% where i am at. Federal tax is around 37 to 39 percent maxed right now.. . if you took that cash instantly without defering any of the taxes for 25 years (most you can defer taxes on lotto winnings legaly for federal taxes) you would still be recieving a check for around 2.5million to 2.75million. lets say you spend it down... [ More ]

Reply #9

visiondude — Thu, 05 Sep 2002 01:18:39 GMT

freddy, while reaping only $60 million off a $200 million jackpot seems to be a ripoff (it is - tax wise), you forget three important quotients in determining which choice to make. lump sum vs. annuity.1)CONTROL . first and most important is that you control your money, not someone else. and especially not the government. lump sum puts the control factor directly into your hands to begin with. if you are afraid of being able to handle money wisely especially over a long period time you

Reply #8

CASH Only — Wed, 04 Sep 2002 18:55:18 GMT

Convp: Allowing the lottery to assign an annuity to you is FOOLISH. If you win, get expert FINANCIAL/TAX/LEGAL advice so you can make sure the LUMP SUM works for you.

Reply #7

convp7690 — Wed, 04 Sep 2002 18:48:59 GMT

I agree with Freddie. Besides, I read this study that says that people who opt for a lump sum usually go through all the money in a few years. If you get the money over 20 or 30 years you will still have some more than a few years from now.

Reply #6

CASH Only — Wed, 04 Sep 2002 18:47:33 GMT

Freddy, where do you live? I'm from NY, the only Mega Millions state (including Washington, which joined today) where the cash/annuity choice must be made when you PLAY, instead of after you win. The 60-day rule that you often read about regarding lottery winners should be made mandatory (ie, if someone wins _any_ US lottery prize {including through scratch tickets} where the prize is paid in _X_ annual installments, the winner must be allowed to collect, in lump sum, the actual retail value... [ More ]

Reply #5

Freddy — Wed, 04 Sep 2002 18:08:29 GMT

I guess you're right but I guess I cringe when I hear someone won a $200 million dollar jackpot but after they take a lump sum and taxes, they are left with $60 Million???? But you're right because even 3% annually in munis or something would get you much more than that from the principal. My point was if I forgot to check the cash box and I won, I would have worse problems in my life.

Reply #4

CASH Only — Wed, 04 Sep 2002 15:04:43 GMT

Freddy: Todd, myself, and others have pointed out various pitfalls involving annuity payments. Most lotto games pay the annuity in 25, 26, or 30 annual payments (Powerball's new format, coming next month, includes a change in the annuity, from 26 to 30 installments.) Several games, including California SuperLotto Plus, pay the annuity so that the smallest payments are at the beginning. CA SL+ and some other games still require the choice to be made when you PLAY instead of after you win. And, th... [ More ]

Reply #3

Freddy — Wed, 04 Sep 2002 12:58:30 GMT

If I made that much, I guess I would not care if I got it over 20 years or a lump. Either way, can't really label anyone as a loser with that problem.

Reply #2

CASH Only — Fri, 30 Aug 2002 15:15:07 GMT

Cheatah: Illinois Lotto DOES have a cash option. I already pointed this out to you. Please do your homework.

Reply #1

lottocheatah — Fri, 30 Aug 2002 14:28:19 GMT

Yep. Illinois Lotto too, Annuity only [20 years, I think].

TX winner a potential loser

CASH Only — Fri, 30 Aug 2002 11:17:09 GMT

The article Todd posted this morning about the Houston-area Lotto Texas winner DID NOT mention that Lotto Texas has a cash option, which like California, and here in New York, must be exercised at the time of purchase. The article leads people (who casually follow US lotteries) to believe that Lotto Texas is like the Mass. 6/42 and 6/49 games, both of which are still ANNUITY-ONLY.