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Spltting jackpot with family

Topic closed. 10 replies. Last post 6 years ago by socalgal.

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Minnesota
United States
Member #103623
January 4, 2011
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Posted: January 4, 2011, 5:07 pm - IP Logged

Long time reader first time poster Smile

Okay my search-fu is not strong and I cant seem to find an answer for this: If I won here in Minnesota tonight and decieded to split it with my family could i designate percents to family members, for instance 1% to 20 different family members while taking 80% myself, or does it have to be split evenly?

 

I think this would go a long way towards taking care of the "cousin" issue. See my logic is if I split with my aunts/uncles, parents, grandparents etc it means my gifting is easier and any long lost cousins that arrive would have a more direct line for who they go to for money. Plus the jackpot is so huge I cant see taking care of my family anyways.

Also it would I believe help mitigate the media if it is a huge group of people the chances to "feed" the media without having to give the "what are you going to do with the money" stories myself is greater.

And hard to ask for money I think (but still happen im sure lol) if you were already given a chunk 1% is over a million after taxes afterall.

Thanks in advance.See Ya!

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    March 9, 2006
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    Posted: January 4, 2011, 5:56 pm - IP Logged

    Search for . . irs 5754

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      Minnesota
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      Posted: January 4, 2011, 6:35 pm - IP Logged

      Thanks that helped, no wonder I couldn't find it lol. Now still would the lottery really or i guess HAVE they ever raised a stink about the % of split tickets?

        djklaugh's avatar - Lottery-031.jpg
        Portland,Oregon
        United States
        Member #14387
        April 25, 2005
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        Posted: January 4, 2011, 8:50 pm - IP Logged

        Get with a really good attorney to set up a trust that would collect the winnings for you and then disburse the amounts you designate to each family member.   If you tried to do it at the lottery office you would have to have every single person you were giving a share to present as they would have to fill out tax information. Having the attorney set it up in advance simplifies things and keeps it neat and tidy - you might need to wait a few weeks to claim the money but it would be worth it in the long run.

        Djklaugh

          Some things have to be believed to be seen.

        "I have not failed. I have just found ten thousand things that don't work".  Thomas Edison

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          NY
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          October 16, 2005
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          Posted: January 5, 2011, 5:51 pm - IP Logged

          Thanks that helped, no wonder I couldn't find it lol. Now still would the lottery really or i guess HAVE they ever raised a stink about the % of split tickets?

          Neither the lottery nor the IRS have any say in how you share your property. It's your ticket, so if you want to give 1.374% to Aunt Mary and 2.662% to Uncle Bob it's your choice.

          The lottery does get to make rules on how they write checks, and they may not be willing to write the checks necessary for the split you want.  Even if they will, the lottery will usually make the names of all winners part of the public record. That's what the appropriate IRS forms are for. You can have one person collect from the lottery and then make the distribution.

          Of course the IRS makes the rules on  taxes, and you have to account for that. One of those rules is that if the 2.662% you give to Uncle Bob is $3.6 million (about the after-tax amount in NY, based on the current MM jackpot) it's a taxable gift of $3.6 million. You get a lifetime exemption of $1 million, but that would leave a taxable gift of $2.6 million. The maximum rate for the gift tax is 35%, so the $3.6 million gift could cost you another $910k in taxes. Of course that doesn't account for the 35% on the additional 5, 10 or 20% you might want to share with others.

          OTOH, if you give somebody a share of the ticket(s) before a drawing gives you a winning ticket the gift has a value of a few cents to a few dollars. Instead of one winner sharing a huge prize it becomes multiple winners each collecting their share of the prize. That leaves you with two choices. Wait until you win to make large gifts and then try to convince the IRS that they weren't fifts because you  shared the ticket right from the start, or really make a gift  of shares in the ticket(s) as soon as you purchase them. Of course you'll want proof of that, so you'll want something in writing that will clearly establish when the gift was made, which can be easily accomplished with a simple affidavit. You can write your own easily enough, and have it notarized (probably for free) at your bank.

            AuntiePat's avatar - animaniacs10
            Just outside of Cleveland, OH
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            August 3, 2007
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            Posted: January 5, 2011, 6:00 pm - IP Logged

            I am reminded about a family that was claiming a now moderate, then large jackpot from a lottery office.  First, you don't just show up--you allow them to verify the winnings and then arrange a time for the presentation ceremony--what--you think lottery offices everywhere have large checks made out in the winners' names laying around?  Anyway, back to the family--they all sat down for their portraits and whipped out those cheesey multicolored dynel clown wigs with a Jimmy Durante nose and Steve Martin classes attached--and they were well within their right to do so--their state's lottery said they had to be available to answer questions and have theur pictures taken--NOT that they had to be recognizable.

             

            As far as splitting a jackpot with family--just who else would you give it to--not doing so aould cause unimaginable hurt--remember Bud Posts' brother tried to hire a hit man so he could inherit before the money was all gone from his brother's win.  Why would anyone want to deliberately hurt the only group that knows what it's like to be them.  Knew two small lottery jackpot winners (one for $268,000 in 1970's and one for $500,00 in the 90's)--both said the money was bery isolating--well the first one did--the second one just became a really bad drunk--and lived out the rest of his life distrustful of everyone--sad way to live.  Would have been nice if a Lottery Poster would have won, but it doesn"t seem so.

              socalgal's avatar - bobblecars3
              California
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              Posted: January 5, 2011, 8:49 pm - IP Logged

              If you can claim the winnings as a trust, then you can specify the percent for each member in the trust details.  The grantor (you) can also be the beneficiary.  So you would list all family members (including you) as beneficiary of the trust.

              I read several law websites that says a person can be all 3 - grantor, trustee and beneficiary.  But they don't recommend that.

                Coin Toss's avatar - shape barbed.jpg
                Zeta Reticuli Star System
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                January 17, 2006
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                Posted: January 5, 2011, 9:36 pm - IP Logged

                If you win a huge jackpot family that you wwren't aware of are probably just as much as a problem!

                Those who run the lotteries love it when players look for consistency in something that's designed not to have any.

                Lep

                There is one and only one 'proven' system, and that is to book the action. No matter the game, let the players pick their own losers.

                  savagegoose's avatar - ProfilePho
                  adelaide sa
                  Australia
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                  April 11, 2006
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                  Posted: January 6, 2011, 9:36 am - IP Logged

                  been an interesting read.  although i dont have much to say, thanks for all the comments ive soaked it all up.

                  her ein oz there are no taxes on winnings but there are laws reguarding gifting large amounts of money. so a share in the prize may well be better than just handing out the money after.

                  2014 = -1016; 2015= -1409; 2016  = -1171; 2017 = ?  TOT =  -3596

                  keno historic = -2291 ; 2015= -603; 2016= -424; 2017 = ? TOT = - 3318

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                    Milwaukee, WI
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                    December 27, 2003
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                    Posted: January 7, 2011, 10:34 pm - IP Logged

                    I believe that anything over $11,000 and you have to pay tax on it.

                    MrkP

                      socalgal's avatar - bobblecars3
                      California
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                      Posted: January 8, 2011, 6:21 pm - IP Logged

                      I've already made a list of family relatives that are in my life now, when I'm still just a regular person.  When new ones pop up when I'm a winner, and they're not on the list, then I say "Sorry, see ya."

                      I also thought about "how" I'm going to share my winnings. Some of my relatives are not responsible with money. If I just give them a certain amount then they'll blow it all quickly and still be in debt. 

                      I thought the main thing I would do is pay off most of their bills. That way they don't have that burden anymore and can start saving money on their own.