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Planning On Winning A Jackpot?

Topic closed. 33 replies. Last post 11 years ago by Chewie.

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June 2, 2005
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Posted: November 12, 2005, 9:57 pm - IP Logged

It would be a great effort if we would win the lotto jackpot in MM, CA SLP, or PB. I would talk to advisors and pick cash option should we win a lotto jackpot because it is a one time cash option. Uncle Sam would take more income tax if I had chosen payments.

    BaristaExpress's avatar - BaristaExpressMX zpsfb0d8b5d.png
    Magnolia, Delaware
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    Posted: November 12, 2005, 11:01 pm - IP Logged

    Just6ntlc, Uncle Sam will get a nice sum before you get your check, but in the long run he would get even more over the years if you were to take payments! Everyone knows taxes don't go down, they always go up! So, what would you really pay in taxes (lets say) 15 years into your payments? We really don't know right now, but you could bet your last dollar you are going to be paying a higher tax rate than you are today! This is the prime reason to take the cash option over an annuity!

    Keep dreaming the impossible dream, it just may come true! Thumbs Up

      BaristaExpress's avatar - BaristaExpressMX zpsfb0d8b5d.png
      Magnolia, Delaware
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      Posted: November 12, 2005, 11:04 pm - IP Logged

      My bad Just6ntlc, I thought you were in favor of taking the annuity! Sorry for misreading your posting.

      Keep dreaming the impossible dream, it just may come true! Thumbs Up

        TheGameGrl's avatar - character catafly.jpg
        A long and winding road
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        June 10, 2005
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        Posted: November 12, 2005, 11:30 pm - IP Logged

        Chewie, If I ever win the BIG ONE (MEGABALL), I would consider hiring you to cover my finances. Your ideas make sense! As off center as this sounds, what if a person creates a religious group and thus dodges taxes that way? From what I have read "so long as two or more persons gather together to practice their religious beliefs and ceremonies" -They may be constitued as a religious group, thus barring them from certain taxation. Actually had a case like this go to court because a family appealed to the courts that they were a religious group and thus exempt from taxation. They were fighting real estate tax since they considered their house a church since they met each Saturday to discuss and practice their faith.The case was won too! ( as I said- its off center and far fetched , yet an idea none the less.).

        ~~Is it true, Is it kind,Is it necessary. ~~~

        christmas holly jolly numbers: 255,303,6911, 474,477 silver:47,gold:79.

          dvdiva's avatar - 8ball

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          Posted: November 13, 2005, 2:07 pm - IP Logged

          Considering how little I make now they could withhold 100% of my W2 income after a MM win and I could care less.

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            Sparta, NJ
            United States
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            July 9, 2005
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            Posted: November 13, 2005, 2:40 pm - IP Logged

            Chewie, If I ever win the BIG ONE (MEGABALL), I would consider hiring you to cover my finances. Your ideas make sense! As off center as this sounds, what if a person creates a religious group and thus dodges taxes that way? From what I have read "so long as two or more persons gather together to practice their religious beliefs and ceremonies" -They may be constitued as a religious group, thus barring them from certain taxation. Actually had a case like this go to court because a family appealed to the courts that they were a religious group and thus exempt from taxation. They were fighting real estate tax since they considered their house a church since they met each Saturday to discuss and practice their faith.The case was won too! ( as I said- its off center and far fetched , yet an idea none the less.).

            I just read the news a lot.  Once you filter the political barf, there are things to learn. Especially how corporations functions.  Yahoo has a business section where you can spend your life browsing how corporations spread money around between executives, while keeping the base salary the same.  I read about one company that hired a guy from one location, to be president of the company.  They gave him a hiring bonus, even though he already worked for them.  They gave him several million in stock options, of which he immediately cashed in.  The first day on the job, he made six million dollars.  All legal.  I'm thinking, form an LLC, hire certain people (friends) to manage my money.  Issue the bonus and hire-on options, etc., then fire them for not making enough money in the first 90-days.  Then pay the termination penalty, (like Disney did), and walla, you transferred money to friends without a penalty.  Then you get to hire more friends.  The great part, would be hiring them as contract labor, no internal expense.

            Cheers

            |||::> *'`*:-.,_,.-:*''*:--->>> Chewie  <<<---.*''*:-.,_,.-:*''* <:::|||

            I only trust myself - and that's a questionable choice

              rundown99's avatar - cigar

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              Posted: November 14, 2005, 1:44 am - IP Logged

              I have a question

              Suppose you claim your prize.  It will take at least two weeks to get the full amount of money.  But do they give you some of the money up front so that you can get out of town and rent a car, those type of things.  And besides, during those two weeks you are waiting, couldn't someone try to convince the lottery to give them the money instead.  Like, what if a greedy relative called up the lottery and tried to convince the lottery that he/she was authorized by you to take the money.  I know that it most likely won't happen , but there are stories, such as divorces and fights where the money would be frozen before even being sent to the winner.  You never know. .... it might be better to be anonymous after all so that you will get the money for sure.

              Smart lottery winners form trust to claim their winnings.  They send an attorney to the lottery headquarters to claim the prize in trust, so that ONLY the name of the trust is revealed.  And they tell NO ONE, especially relatives.

              If you ever win a lottery and you are single, the only person you should ever marry is someone who was truly in love with you BEFORE you won the jackpot!

                dvdiva's avatar - 8ball

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                Posted: November 14, 2005, 1:50 am - IP Logged

                I'm not aware of any lottery giving an advance on the winnings. If it's in a trust, unless it's the lawyer taking the cash and running, you would have little to worry about. The prize could easily be held up by a lawysuit for a while like that crazy woman who claimed she "lost" the winning ticket.

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                  New Member
                  Louisiana
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                  September 12, 2005
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                  Posted: November 16, 2005, 10:13 am - IP Logged

                  The way I calculate it David Edwards received a $41 million lump sum before taxes from his win of $71 million. Factor taxes into it and he gets around $23 million. If he gets $14,000 a day interest then his rate of return is about 23% and that is very very good.  I think his broker is from Morgan Stanley or was at the time of the TV show "Jackpot: Homes of Lottery Winners".

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                    Sparta, NJ
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                    July 9, 2005
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                    Posted: November 16, 2005, 1:13 pm - IP Logged

                    I have a question

                    Suppose you claim your prize.  It will take at least two weeks to get the full amount of money.  But do they give you some of the money up front so that you can get out of town and rent a car, those type of things.  And besides, during those two weeks you are waiting, couldn't someone try to convince the lottery to give them the money instead.  Like, what if a greedy relative called up the lottery and tried to convince the lottery that he/she was authorized by you to take the money.  I know that it most likely won't happen , but there are stories, such as divorces and fights where the money would be frozen before even being sent to the winner.  You never know. .... it might be better to be anonymous after all so that you will get the money for sure.

                    I have no idea if any state would give you an advance; although I swear I remember reading about it happening (can't find it any more).  However, it is not really important.  If you have the validated ticket, no state is going to hand you a physical check with that high of an amount.  That means you would have to have some place to transfer $185M to.  Stand up and say "I won (for example) $185M cash," and no doubt, the money machines will be lining up for a shot at that gold.  I would (safely) assume, many of those will be the major banking industries.  If you can't negotiate a sizeable advance, with the collateral of $185M, you need to start spending your money on candy bars - instead of lotto tickets.

                    Cheers

                    |||::> *'`*:-.,_,.-:*''*:--->>> Chewie  <<<---.*''*:-.,_,.-:*''* <:::|||

                    I only trust myself - and that's a questionable choice

                      sirbrad's avatar - Lottery-062.jpg
                      PA
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                      Posted: November 21, 2005, 12:06 pm - IP Logged

                      The way I calculate it David Edwards received a $41 million lump sum before taxes from his win of $71 million. Factor taxes into it and he gets around $23 million. If he gets $14,000 a day interest then his rate of return is about 23% and that is very very good.  I think his broker is from Morgan Stanley or was at the time of the TV show "Jackpot: Homes of Lottery Winners".

                      Yeah that is about what I figured as well. Who pays that type of interest? I think the most I have came acrossed so far was about 10%. Most banks I checked average only about 4% for very large sums of money, if that!

                        sirbrad's avatar - Lottery-062.jpg
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                        Posted: November 21, 2005, 12:10 pm - IP Logged

                        I have a question

                        Suppose you claim your prize.  It will take at least two weeks to get the full amount of money.  But do they give you some of the money up front so that you can get out of town and rent a car, those type of things.  And besides, during those two weeks you are waiting, couldn't someone try to convince the lottery to give them the money instead.  Like, what if a greedy relative called up the lottery and tried to convince the lottery that he/she was authorized by you to take the money.  I know that it most likely won't happen , but there are stories, such as divorces and fights where the money would be frozen before even being sent to the winner.  You never know. .... it might be better to be anonymous after all so that you will get the money for sure.

                        I have no idea if any state would give you an advance; although I swear I remember reading about it happening (can't find it any more).  However, it is not really important.  If you have the validated ticket, no state is going to hand you a physical check with that high of an amount.  That means you would have to have some place to transfer $185M to.  Stand up and say "I won (for example) $185M cash," and no doubt, the money machines will be lining up for a shot at that gold.  I would (safely) assume, many of those will be the major banking industries.  If you can't negotiate a sizeable advance, with the collateral of $185M, you need to start spending your money on candy bars - instead of lotto tickets.

                        Jack Whittaker received a $10 million dollar advance because they did not have all his money for his $111 million, or something like that, lump sum. That was odd to me. How could they not have it? Why even play then? I wonder if that has happened since? If someone wins they damn well better be prepared to pay up what they advertised. They already over-inflate the jackpots way too much as it is.

                          sirbrad's avatar - Lottery-062.jpg
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                          Posted: November 22, 2005, 9:17 am - IP Logged

                          Sirbrad,  No interest earned, No Income Tax on the money! As long as the principle earns you no income, then you can't be taxed on it! As you asked and answered your own question>> Would you still have to pay 13% every year after that? << Answer is NO! Or just once? <<< Yes, on the one time to make up the difference of what wasn't taken when the IRS took their first 25%.

                          How about for a game such as lucky for life? I figured that after the IRS got their cut (25%) you would end up with about $27,000 per year? Which in reality is $2,250 a month for life, not $3,000. Would you still have to pay the 13% taxes on that, and only once? That amount is small enough as it is, so that would be ludicrous actually to charge more tax after the already huge hold out. But that is the IRS for you....ludicrous.

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                            Sparta, NJ
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                            Posted: November 22, 2005, 9:22 am - IP Logged

                            Same situation as every other annuity; the value has no bearing. 

                            Cheers

                            |||::> *'`*:-.,_,.-:*''*:--->>> Chewie  <<<---.*''*:-.,_,.-:*''* <:::|||

                            I only trust myself - and that's a questionable choice

                              sirbrad's avatar - Lottery-062.jpg
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                              Posted: November 22, 2005, 9:37 am - IP Logged

                              Same situation as every other annuity; the value has no bearing. 

                              So 13% once then you're done? I would definitely be living off the pricinpal, as I doubt one could accumate enough interest to live off of that. At 5% that is about $115 a month. And that is if you do not touch the money! You would have to be already rich to do that. So there would be no more "income" after that right?