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A couple of new questions (I think)...cash gifts, pools winning option

Topic closed. 9 replies. Last post 5 years ago by stripesnsolids.

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Coin Toss's avatar - shape barbed.jpg
Zeta Reticuli Star System
United States
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January 17, 2006
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Posted: February 12, 2012, 6:03 pm - IP Logged

Don't think I've seen these covered:

1. Someone recently posted that a couple could give gifts of $26,000, that being the limit of $13,000 by each (I thought it was $12K).......but if they gave $50,000 let's say, could they call $26,000 of it a gift?

2. If players in a pool win a jackpot, does the entire pool have to unanimously choose annuity or cash option, or can the individuals choose one by one? I'm thinking that would be quite a trick but I'm not sure if it's allowed or not.

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.

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    Inland Empire
    United States
    Member #118116
    October 22, 2011
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    Posted: February 12, 2012, 6:40 pm - IP Logged

    Don't think I've seen these covered:

    1. Someone recently posted that a couple could give gifts of $26,000, that being the limit of $13,000 by each (I thought it was $12K).......but if they gave $50,000 let's say, could they call $26,000 of it a gift?

    2. If players in a pool win a jackpot, does the entire pool have to unanimously choose annuity or cash option, or can the individuals choose one by one? I'm thinking that would be quite a trick but I'm not sure if it's allowed or not.

     Maybe the benefactot should give the money in installments.

      savagegoose's avatar - ProfilePho
      adelaide sa
      Australia
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      April 11, 2006
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      Posted: February 12, 2012, 9:21 pm - IP Logged

      Don't think I've seen these covered:

      1. Someone recently posted that a couple could give gifts of $26,000, that being the limit of $13,000 by each (I thought it was $12K).......but if they gave $50,000 let's say, could they call $26,000 of it a gift?

      2. If players in a pool win a jackpot, does the entire pool have to unanimously choose annuity or cash option, or can the individuals choose one by one? I'm thinking that would be quite a trick but I'm not sure if it's allowed or not.

      as to part

      2:  does the entire pool have to unanimously choose annuity or cash option?

       

      the answer is yes. ideally it should be decided before the pool starts collecting cash and mentioned to everyone so they understand. remember the lottery only want to deal with 1 person , the  pool manager. and sure as heck dont wan tto cut checks for 20 people ea winning ticket.

      its just more fun to take to lawyers and argue over in a pool.

      2014 = -1016; 2015= -1409; 2016 JAN = -106; FEB= -81; MAR= -131; APR= - 87: MAY= -91; JUN= -39; JUL=-134; AUG= -124; SEP = -123; OCT= -84  NOV=- 73 TOT= -3498

      keno historic = -2291 ; 2015= -603; 2016= JAN=-32, FEB= +12 , MAR= -86, APR = -77. MAY= -48, JUN= -29, JUL=-71; AUG = -52; SEPT= -43; OCT = +56 NOV = -33 TOT= -3297

        dk1421's avatar - Lottery-024.jpg
        North Carolina
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        Posted: February 12, 2012, 9:34 pm - IP Logged

        #1 - to my knowledge: If Tom and Mary win the lottery and want to give money to James & Joyce, here is how they can do it for the most money without taxes: Tom gives $13k to James and $13k to Joyce. Mary gives  $13k to James and $13k to Joyce. James and Joyce now have $26k each or $52k total as a couple. This is per year, but I do think there is a cap of $500,000 (?) for that person's lifetime.

        Now my question the other day was: if you are in an LLC - does that count as one entity, or can my hubby & I still do the amounts like the paragraph above.

        BTW - the $13,000 may change next year, back to $10k or $12k. But we'll see.

        #2 - yes, they have to choose one or the other - 99% of the time. However, I do recall seeing where it was separate, but I don't remember if that was years ago when it was unusual for a group to win or if it was just a specific state that allowed it (but probably doesn't anymore).

        "Don't be a schmuck, always take the cash." -Coin Toss

          CDanaT's avatar - tiger avatar_04_hd_pictures_169016.jpg
          TX
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          Posted: February 12, 2012, 9:42 pm - IP Logged

          Don't think I've seen these covered:

          1. Someone recently posted that a couple could give gifts of $26,000, that being the limit of $13,000 by each (I thought it was $12K).......but if they gave $50,000 let's say, could they call $26,000 of it a gift?

          2. If players in a pool win a jackpot, does the entire pool have to unanimously choose annuity or cash option, or can the individuals choose one by one? I'm thinking that would be quite a trick but I'm not sure if it's allowed or not.

          C.T.       
             That was my post just a few days ago.....The $13K is the standard that was set this year(2012) for 1 person to give to another ( like you give $13K to grandma) and available under the IRS.gov website publication 950 dated OCT 2011....The gift of $26K is called "split gifting" as a  couple. Lets say you & your wife agree to give the money to your grandmother ($13K from you and $13K from your wife) You can legally give her that but have to file a special IRS form(706  or 709) letting them know this was done by you and your wife.  REMEMBER, every transaction over $10,000. generates a red flag to the government.....
          The $50,000.00 gift can be done like you say...report $26,000.00 as the "split gift" but the remaining $24000.00 WILL be considered at the "Gift tax" rate of 35% which you and your wife will have to pay (not grandma)............Please consult a licensed professional to ensure no NEW rules apply  Thumbs Up


             As far as the group win is concerned...I thought there was a Powerball group win that did both annuity & cash  within the last 5 - 10 years, if not it may have been a group that won the Florida lottery before  Powerball was introduced  in 2009. I am not sure which.

          Stay Positive, Believe and good things will come your way

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            Kentucky
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            Posted: February 12, 2012, 9:52 pm - IP Logged

            Don't think I've seen these covered:

            1. Someone recently posted that a couple could give gifts of $26,000, that being the limit of $13,000 by each (I thought it was $12K).......but if they gave $50,000 let's say, could they call $26,000 of it a gift?

            2. If players in a pool win a jackpot, does the entire pool have to unanimously choose annuity or cash option, or can the individuals choose one by one? I'm thinking that would be quite a trick but I'm not sure if it's allowed or not.

            "Someone recently posted that a couple could give gifts of $26,000, that being the limit of $13,000 by each (I thought it was $12K).......but if they gave $50,000 let's say, could they call $26,000 of it a gift?"

            A married couple can each give someone a $13,000 for a total of $26,000 or the can give another married couple $52,000. To give one person $50,000, the first $26,000 would probably be considered a gift and I assume taxes must be paid on the other $24,000.

            "If players in a pool win a jackpot, does the entire pool have to unanimously choose annuity or cash option, or can the individuals choose one by one? I'm thinking that would be quite a trick but I'm not sure if it's allowed or not."

            I asked that question many years ago in Ohio and while they will distribute the cash jackpot in equal amounts, they won't divide by 25% for one person and 10% for another. Don't know the rules for every state lottery, but every one I've read will only distribute cash for a group win and that has to be in equal amounts.

            When you think about it, why the lottery set up annuities for a group of 10 to maybe 100 or more?

              Coin Toss's avatar - shape barbed.jpg
              Zeta Reticuli Star System
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              Posted: February 13, 2012, 12:59 am - IP Logged

              dk1421,

              Sorry, I forgot it was your thread, CDanaT, your post.

              Yeah, basically what I was asking is if you exceeded the gift limit could you at least make up to the limit exempt. Or would the tax people say something like gee, if you would have stayed under the limit there'd be no tax, unfortunately you went over......

              As for a ppol choosing both options, interesting that we already have different answers, CDanaT's post and Stack47's. Maybe it's state by state.

              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.

                sully16's avatar - sharan
                Ringleader
                Michigan
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                Posted: February 13, 2012, 9:08 am - IP Logged

                I know if your buying a house from a relative for less than whats it's worth your allowed 12k in the gift of equity per person, as long as the equity is there.

                Did you exchange a walk on part in the war ?

                For a lead role in a cage?

                 

                                                            From Pink Floyd's " Wish you were here"

                  CDanaT's avatar - tiger avatar_04_hd_pictures_169016.jpg
                  TX
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                  Posted: February 13, 2012, 1:05 pm - IP Logged

                  Don't think I've seen these covered:

                  1. Someone recently posted that a couple could give gifts of $26,000, that being the limit of $13,000 by each (I thought it was $12K).......but if they gave $50,000 let's say, could they call $26,000 of it a gift?

                  2. If players in a pool win a jackpot, does the entire pool have to unanimously choose annuity or cash option, or can the individuals choose one by one? I'm thinking that would be quite a trick but I'm not sure if it's allowed or not.

                  Here's a quote from the Powerball website in the FAQ  section, "CAN INDIVIDUALS IN A GROUP CHOOSE CASH AND ANNUITY ?...RESPONSE: An individual lottery may have individual rules on how they pay the winner ( how many checks; how many winners to process, etc.) but we can handle any request to divide the prize payment. We can divide the prize however the individuals in a group wish, including different requests for cash or annuity."

                  Stay Positive, Believe and good things will come your way

                    stripesnsolids's avatar - box
                    GA
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                    September 25, 2010
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                    Posted: February 13, 2012, 5:48 pm - IP Logged

                    Don't think I've seen these covered:

                    1. Someone recently posted that a couple could give gifts of $26,000, that being the limit of $13,000 by each (I thought it was $12K).......but if they gave $50,000 let's say, could they call $26,000 of it a gift?

                    2. If players in a pool win a jackpot, does the entire pool have to unanimously choose annuity or cash option, or can the individuals choose one by one? I'm thinking that would be quite a trick but I'm not sure if it's allowed or not.

                    I have an answer for your first question.

                    The new annual limit is $13k however you can deduct the taxes owed on any amounts over the annual limit from your unified credit (this is a lifetime deduction) for 2012 the amount is $1,772,800.

                    In this example the tax bracket is probably wrong but it's for illustration purposes only.

                    say you gave someone $100,000 and the gift tax on $87,000 (the amount after the first non taxable $13,000) is $6,000, you would deduct $6,000 from your $1,772,800 limit and still have $1,766,800 of credits for another year or person for that matter.

                    Think of the unified credit as your gift tax bank.