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Claiming Anonymously and keeping your winnings! (a paranoid approach)

Topic closed. 22 replies. Last post 5 years ago by maximumfun.

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Zeta Reticuli Star System
United States
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January 17, 2006
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Posted: April 30, 2012, 4:27 pm - IP Logged

PeteLawson,

Not too long ago Illinois added monitors near the scanners where you check your tickets. At first people who won over a certain amount (not sure what it is) had their names (first and last), game won on, amount and hometown put on the monitors. There must have been a lot of complaints and people contacting the lottery (Northstar now runs it for the state) because now it only shoes first name, game and amount.

The femalde pharmacist who won the MM told the lottery that being a pharmacist, if she showed up 'natch' (nodisguise) and they divulged her name that she would get malpractice suits left and right. That was a few years ago though.

Maybe we should start a thread and ask people what it says on the back of their particular states tickets, one reply from each state would do and I'm curious what it says on the tickets from 'anonymous' states.

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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    Kentucky
    United States
    Member #32652
    February 14, 2006
    7343 Posts
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    Posted: April 30, 2012, 4:48 pm - IP Logged

    Hi Everyone,

    I'm a Longtime LotteryPost reader, first time contributor. I've been visiting this site and Todd's USA Mega for at least 5 years, been playing the lotto a lot longer than that. This probably seems like a big pretentious first post, but I joined because I wanted to share some thoughts and info I've accumulated over the years, if you don't mind. This is an awesome community and I love hearing your thoughts and rhetoric over the forum topics here, so I'd love to share one more, if you don't mind, and get your feedback too!

    The idea of this post is to talk to about the importance of claiming anonymously when(!) each of us wins those multi-state jackpot lottos. I'd say this could also apply to state lottos or, probably, anything $100,000 or above. But I'm going to tailor my thoughts toward multi-state lotto jackpots of around $50,000,000 or more (or, say, $20,000,000 cash option). You know, the BIG jackpots that we all dream about. No I'm not a lawyer and don't have any friends who are, these are just some friendly ideas about a topic that I think is so important to all of us for when we win. So! I'd love to share some stuff.

    How important is it to claim anonymously? VERY IMPORTANT. When you win, it might be the single MOST important thing you do. It's more important than changing your phone number, or buying a house away from your hometown, getting finance advisors (more on that later), etc. In my experience (which I admit is probably limited) claiming anonymously is the most important thing you can possibly do.

    "But Wait!" we might say. Most lotteries do not allow anonymous claims! That is true. Most lotto commissions don't allow it and to be honest I agree with their reasoning: we all want to make sure it's a ticket buyer who wins and not the state extorting our bets and our ticket purchases. But that doesn't mean you still can't claim anonymously. Yes: you can claim via a proxy. There's lots and lots of tax benefits to claiming via a proxy, but, to me, the biggest is being able to claim anonymously.

    A proxy can be a number of things, but I really only recommend one type. To claim via a business entity of some sort. That can be a trust (I've seen a lot of great discussion on these in the forums), an LLC or a corporation. There's others too but these three are the ones I think would be best, and I'll explain below.

    Now, in most cases you can't form one of these entities on your own. It's possible, depending on your state (OH and KY, for example, have pretty simple forms you can fill out to create an LLC) but I wouldn't recommend it. I would recommend getting a lawyer to do this for you. Yikes! I know there's been a lot of debate over whether or not to trust your ticket over to a lawyer but, despite the risks (I suppose there are a few but I'll try to argue against them), I think it's absolutely worth it. Why? Well, again to remain anonymous. Many state lotto commissions require two things: to be able to publish the winner (that will be your trust or your LLC/Corp), and to be able to either do a press conference with someone, with some real person, in their offices, or to at least be able to publish the person's name who claims for your trust. If you form your own LLC who are you going to have claim it for that LLC? If you have a friend do it, then your circles (assuming they're your friend's circles) are going to start asking questions and your dear friend might get so heckled that s/he'll reveal it was actually YOU who won. You don't want that. Get your lawyer or someone in his/her office to do it. That way no one knows it's actually you who's behind those winnings and that claim. 

    Let's talk about these "entities" first, then I'll talk about lawyers.

    Before you see a lawyer, think about what kind of entity you want to form. In most cases a trust is the best one to form. As far as I know, you don't need it to be a blind trust to still claim anonymously. The most standard trust for living people is a "Revocable Living Trust." This one will allow you to claim anonymously, give you some solid tax benefits, and if your lawyer starts to anger you, or you just want to part ways, you can fire him and move onto someone else. The money is still yours, you still hang onto controlling the trust, and you still remain anonymous. You can even dissolve the trust and just take all the cash for yourself if you want, but I don't recommend that at all.

    A trust doesn't work for everyone, though. The biggest reason a trust won't work is if you're playing with other people who AREN'T family. If you play with co-workers (as I do) or friends, in many cases a trust won't work. Trusts are designed for money to be shared with family, but not with friends or colleagues (without of course angering the Tax Man) so in order to reap the anonymous and tax benefits of playing with friends, I'd suggest an LLC. A corp also works but it's a bit of an older entity that could make things more difficult for you or your lawyer if claiming that way. An LLC is nice though because you and your friends will receive the same benefits and, once those initial tax winnings are paid off, you can collect the cash and spend it however you want. You don't have to pay additional taxes for every time you take a smooth $100K for yourself. You can dip into your LLC and pull out some cash whenever you like and it's your's! It's a bit more complicated than that, and that's why having a good lawyer is really important, but for the most part, with both trusts and LLCs, you can move money back and fourth from your company to your own checking account and spend it however you like.

    A quick digression, but I suggest that if you do play with friends and win: have that money claimed in an LLC (if forming an LLC with a lawyer you will all negotiate how the money will be split BEFORE you get the check (and hey! your group can still remain anonymous)), then split out your winnings as the money comes into the LLC's account. You can have your own trust waiting for the money to pour into as soon as the LLC claims your winnings. You can even dissolve the LLC after each of you have taken out your winnings. Now that LLC doesn't exist anymore and any of those pesky con artists won't be able to track you. The money is now in your trust which was never published by the lotto. Again, it's a bit more complicated than that, but it's a great way to collect your winnings, split it amongst your friends, then have your own money with your own control...not as a part of a group with the people you won.

    Ok a little note about Lawyers.

    Yes, I've heard a lot of horror stories about the crooks that lawyers can be. They can be sinister, evil, and help out the "Bad Guys" consistently. But not all lawyers are bad. Some are honest, follow the law, and legitimately want to help out their clients (including you!) because it brings them joy to do so. These are the lawyers who you want to team up with. It's tough to find one like this, but I might be able to give a pointer or two to help with this.

    Other users I think have talked about the importance of getting a lawyer from a BIG...a REALLY BIG law firm. I couldn't agree more. Why? Well there's quite a few reasons but the biggest I'll point out below:

    1. Lawyers from big law firms deal with lots of wealthy clients like you. If they've ripped off wealthy clients before they'll kick and scream and let the world know about it. It's not worth it to them to rip them off because they'll lose their already-wealthy clients. Not to mention their noteriety.

    2. For the same reason above, Lawyers from big law firms are scrutinized by their firms before they'd ever trust a lawyer to someone like you, New Lotto Winner. In other words, they're not going to let a crook lawyer be your counsel because it would be a PR nightmare for them if that lawyer ripped you off.

    3. These big law firms have as much money as you've just won IN CASH and in many cases much, much more than that. Woah! These law firms are RICH. Which means if one of their lawyers rips you or your trust/LLC off, then you can sue the FIRM for your losses. And they won't be able to hide behind bankruptcy. They'd settle out in a heartbeat because they don't want a court case telling the world that one of their clients was ripped off. And they know the law well enough to know you'd win.

    In other words, these guys won't rip you off. They'd rather keep you as a customer.

    That said, it is still very important that you scrutinize and get a lawyer that you trust. I'd suggest getting a lawyer from the most or one of the most well respected firms in your state. If you're in a state with lots of people (New York, California, Illinois, Texas) you'll have lots to choose from. There's a number of lawyer review websites and the like that can rank "top lawyers" if you need to research. Getting one from one of these firms is best. As far as I know you don't have to get a lawyer from one of your own states, but if they're already practicing (and licensed) in your state, it seems to be that that'd be best. Again, don't get your friend or uncle or anyone personally connected to you to be your lawyer, you'll get too close to having your anonymoty pierced. Get someone big who doesn't know you to take care of forming your trust or LLC for you, and have either him/her OR some associate at the firm to claim the money for your trust/LLC.

    Big law firms have lots of different lawyers. Regardless whether or not you claim via a trust or LLC, I suggest first talking to a "family lawyer/trust lawyer/estate attorney" all names for the same kinds of people. Trust attorneys are often also knowledgeable of LLCs and can work with you and your friends if you need to claim that together. They can also do as I explained above, form trusts for each of you personally for after the money comes into your LLC. If you go with a big firm, they'll team up with their tax attorneys and other attorneys to help you get the best tax and investment benefits too, but that's for another forum topic.

    At this point, before the lawyer goes to claim the lotto ticket, the back of the ticket will be signed with your trust/LLC and plenty of evidence (your trust/LLC will have been formed and there will be a large paper trail with you and with your new law firm leading you to be the true owner of the ticket) so that no one would be stupid as to try to steal your winnings. You're good. Sit at the firm or a local bar and watch the press conference on TV. Heck! Go ahead and draft up a press release for your lawyer to say at the conference. You can tell the truth (I'm a 30 year old construction worker who's been buying tickets for 10 years and plays with 2 friends. I plan to donate to xxx and spend my money first on a new car and a college education for my niece) or lie if you want--though I wouldn't recommend it. Knowing what many of us probably already know from these conferences, you can probably pre-answer certain questions for the conference too. Will you continue buying lotto tickets? Do you like the state lotto? Stuff like that.

    But regardless of whether or not you prepare a statement, tell the truth (or stretch the truth so you reveal too much about who you really are) OR lie, you won't have to show your face or tell anyone who you are. You just collected your winnings anonymously using a trusting lawyer from a big company who has lots of multi million dollar clients. You're another well-respected and loyal client to them, and they are going to treat you really well. Yes, they are going to be expensive. They might cost you $10,000 or more a year for their help. But you just won $50,000,000 in Wednesday's Mega Millions! It's well-worth it, trust me please. You could easily lose $10,000 as Mr. Whittaker did multiple times over the past 10 years. Spend $10,000 or have potentially $500,000 stolen from you? It is SO worth claiming anonymously.

    So let's say now you have your trust, you have your $50,000,000 cash (I don't want to make an argument for annuity vs. cash here, but I'm using cash as an example). Unless over the last few weeks before getting the cash you and your lawyer had a falling out, I'd keep my trust with him as the trustee. No doubt by this point your lawyer has started talking about putting your money somewhere other than a checking account (or whatever kind of bank wire the lotto moved your money to), but if he hasn't, now will be the time he'll probably want to start discussing that. This is where having that trust already formed and already there is going to be really helpful for tax purposes, but I won't get into that here. For one, I'm not an expert, but for another, the main point I wanted to post here was that you claimed anonymously and now, possibly, no one knows that you've won and you have the cash.

    Things get tough here. Chances are you told people you won. It will be incredibly difficult to not tell anyone you've won. I would still suggest not telling anyone but the ones you love most (partner and parents and maybe siblings) until after you've collected the winnings. It will be tough. For one, loved ones are going to want to know why you quit your job if you did (lie to your boss when you quit your job, lie to your friends when you quit your job), but I highly suggest waiting to tell most anyone until after the money gets into your trust.

    Another advantage of having a lawyer is, at this point, you can now discuss how to "deal" with your friends and family. That's a really harsh word and I don't mean to use it that way, particularly since we all care about our family and friends. But you will need a way to deal with anyone who knows you've won, particularly those you care about and want to share your winnings with. Because again, unless you're consistently sharing with them your winnings (which, chances are, are only going to be your partner, parents and siblings), people are going to get resentful regardless of how kind and friendly they are and have been to you over the years. Be careful! And make a plan with your lawyer. Again, many lawyers know how to deal with this sort of thing and will be able to suggest things that are both generous to friends and family, and still maximize your winnings and their own use for you. Only at this point should you slowly start telling people about your winnings IF YOU WANT. If you don't want to, that's totally fine. I certainly wouldn't blame you. 

    I have to imagine at this point, now, you've got your winnings, you have your loved ones taken care of in some sort of way, and now you can indulge. It's probably been about a month since you realized you won (could be longer), so I know it's tough. But now it's all taken care of and whatever payment system you worked out for money to move from your trust to your own personal checking account, is now your's to enjoy in whatever way you wish!

    Let's do a quick example. Let's say after you win Wed's mega millions you get about $50,000,000 cash. You want to share it with your parents. So every six months you each get HALF of 1.5% (so that each year your trust pays out 3% to you and your parents. 1.5% to you, 1.5% to the folks). That's about $375,000 every six months getting deposited to you. Or $62,500 if you want to go month-to-month. Wow!! That's a lot of money! You can start renting a nice place, get a car, travel, indulge in some charities or vices or both! 

    Liquid assets are a different thing entirely because they could be counted toward investments. In other words, you could purchase a $2,000,000 home (or even a $10,000,000 one if you really want to) if you want and still rake in $375,000 cash every six months. But those details you should work out with your trustworthy lawyer, they're going to vary for everyone.

     

    Regardless, I find crunching all of these possibilities really fun. And it's fun to share this info too! Sorry for the length and all that, I hope I don't scare anyone off. I also don't mean to sound arrogant or anything like that. But this is what I'd be doing if I won, figured I'd share it because if you do win! This is honestly, to me, the best way to go about claiming and having your money. I've heard way too many heartbreak stories and this seems to me to be the only way to be able to really enjoy your winnings without heartbreak. There's still a chance heartbreak can happen after winning, but I'm confident this will definitely bring those chances way down. 

    Good luck all!!

    "A proxy can be a number of things, but I really only recommend one type."

    Last year a NY lawyer signed his name on the back of the winning ticket on behalf of a trust but the Iowa Lottery wanted the name of the player buying the ticket before signing the check. Apparently remaining anonymous was so important to his clients, they gave up their claim to the winnings.

    "To claim via a business entity of some sort. That can be a trust (I've seen a lot of great discussion on these in the forums), an LLC or a corporation."

    The state lotteries are required by law to deduct 25% in Federal taxes for U.S. citizens and I believe it's 30% foreigners. An LLC would need a Federal tax ID number so it's possible the LLC could be taxed 25%, but that won't help an Iowa winner because they still want the name of the player purchasing the ticket. You have some fine ideas for remaining anonymous, but at the end of the day, it's the state lottery making that decision.

    On the back the ticket in fine print it says  says something like "Lottery game rules and regulations and state law apply to all games, tickets, transactions, and prizes". By signing the ticket to claim the winnings, players are agreeing to the terms spelled out by the lottery.

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      Kentucky
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      Member #32652
      February 14, 2006
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      Posted: April 30, 2012, 4:57 pm - IP Logged

      PeteLawson,

      Not too long ago Illinois added monitors near the scanners where you check your tickets. At first people who won over a certain amount (not sure what it is) had their names (first and last), game won on, amount and hometown put on the monitors. There must have been a lot of complaints and people contacting the lottery (Northstar now runs it for the state) because now it only shoes first name, game and amount.

      The femalde pharmacist who won the MM told the lottery that being a pharmacist, if she showed up 'natch' (nodisguise) and they divulged her name that she would get malpractice suits left and right. That was a few years ago though.

      Maybe we should start a thread and ask people what it says on the back of their particular states tickets, one reply from each state would do and I'm curious what it says on the tickets from 'anonymous' states.

      "The (add state name) Lottery game rules and regulations and (add state name) state law apply to all games, tickets, transactions, drawings, and prizes"

      Basically we're agreeing to their rules when we purchase our tickets.

        stripesnsolids's avatar - box
        GA
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        Posted: May 1, 2012, 10:57 am - IP Logged

        You have some very good advice for those who are able to use it.  In Georgia, corporations including LLC's info (owners/officers of the company, address, etc.) is publicly available on the Secretary of State's website.  And in every case that I've seen the GA lottery also list the winners name in addition to the name of the LLC or Trust.

          Coin Toss's avatar - shape barbed.jpg
          Zeta Reticuli Star System
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          Posted: May 1, 2012, 11:18 am - IP Logged

          "The (add state name) Lottery game rules and regulations and (add state name) state law apply to all games, tickets, transactions, drawings, and prizes"

          Basically we're agreeing to their rules when we purchase our tickets.

          Stack47,

          It's kind of like a trap. You have to sign the ticket to turn it in to claim the prize, and by signing it you agree to whatever they want.

          I know that's the rules, but since there are states that do allow remaining anonymous, there's no real universal standard so to say.

          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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            Baton Rouge, LA
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            Posted: May 1, 2012, 11:16 pm - IP Logged

            Some interesting points have been brought up here.  A Powerball winner in my state claimed by trust but later, the newspaper had a feature on her with her name! I don't know how they got it, if she came forward to them, someone tipped them off or what, but it didn't keep her anonymous. There is no 100% way to remain anonymous, but there are things that can be done to make it harder to be found. I've read that anyone can be found if someone has the time, the motivation, and the resources to do so, but most people will either give up or run out of money after they hit too many dead ends.

            It isn't just how you claim it that keeps it anonymous, other things can help too. If I were to win a big jackpot and was able to set myself up with a healthy income for the rest of my life so I didn't have to work, I would probably wait several months before quitting my job, after all the excitement had died down. My wife says she doesn't want to quit her job if we win, but we'll see when it actually happens. I have a 3 year old car with only 26K on it so I wouldn't be buying a car, and my wife says she doesn't want a luxury car to drive, so we'd probably buy her a new Honda.

            As for the house, we like our small house and not sure if we want to get something larger, but again, you never know. If we were to move, we'd probably move to a gated community or the like, possibly a little safer. If we were to move out of state, we'd find a place with good tax laws so we could keep more of our money, preferably a state with no state income tax.

            It's also good to look into asset protection, so if something bad happens, it's harder to trace your assets, which I guess falls under anonymity which has already been mentioned. After reading some of the problems winners have had, a winner trying to keep their name private is a good idea.

            Prisoner Six

            "I am not a number, I am a free man!"

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              Jawja
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              Posted: May 3, 2012, 8:50 am - IP Logged

              You have some very good advice for those who are able to use it.  In Georgia, corporations including LLC's info (owners/officers of the company, address, etc.) is publicly available on the Secretary of State's website.  And in every case that I've seen the GA lottery also list the winners name in addition to the name of the LLC or Trust.

              I knew that Ga, being an "open records" state, made the names and addresses of the owners of an LLC available to the public.  However, I am under the impression that the very nature of a trust makes only the name of the trustee public knowledge.  The garrantor and the beneficiaries of the trust are not  technically the owners, though in reality they are. 

              Also, I've seen supposedly top notch asset protection attorneys quoted on line as saying that if the trust is drawn up correctly it doesn't matter if the whole world knows that you won the lottery. because there is no way anyone could get their hands on any of the money anyway.  I'd say that would be good enough if the rule of law means anything, but it really doesn't these days.   That being said, I'd still like to remain anon if I could.

              Be sassy and be happy.

                maximumfun's avatar - Lottery-030.jpg
                Lavender Rocket

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                Posted: May 3, 2012, 4:51 pm - IP Logged

                Hi All,

                Thanks for the warm welcome! And I apologize for the length. But as a longtime lurker this has been a really great community and I really appreciate the welcome from everyone. Yes it is a bit long, I think I might have had a bit too much KY Bourbon, Ridge...ha! And I don't blame you, if I were you I might have had to crack open some Beam before rolling over that post.

                Artist77 brings up a good point so I thought I'd go ahead and add this here. I'm not a lawyer and, unfortunately (not yet!) don't have any first-hand experience with any of this. I only know of what I read and heard from other winners. You're right, Artist77, there is no sure-fire way to remain anonymous and not have your lawyer or law firm betray you if in the case you choose to go this route after winning. I can say, though, that I've heard far more tragic stories from people who don't claim via a proxy, than those who do. So is there a chance of risk? Yes, absolutely. Is the chance that your lawyer or trustee would betray you higher than having lots of con artists come after if you claim the winnings yourself? I don't know, but I'd say the latter is much, much higher.

                Thanks McGinnin! I'll try my best to keep every other post shorter! Again I think I was too excited and let my words get WAY too far away from me. Haha Roll Eyes

                Hey DK! I know my post was probably a bit confusing. I think I stumbled over my words...again might have been the bourbon. Trust or LLC? Well I think I'd go with a Trust if I were the only one who bought the ticket and I were the only one playing. If I were playing with friends or co-workers, I'd go with the LLC because it'll be easier for you and your friends to split the winnings once you get the money. I don't think friends who play in pools together can claim as a Trust, because Trusts are built for families. But again this is only based on my limited knowledge of what I know. Obviously a lawyer will know a lot more about this than I.

                I think I've seen people claim via a trust and still attend the conference, LottoBone. Going in costume would be awesome! If you don't win during Halloween you could still say you're always in the mood to go in costume. It would definitely get the media talking for awhile! haha...

                Coin Toss! Yea those are some excellent points. I think that Brad Duke actually takes that approach. He didn't claim anonymously, but anyone who has any claims or requests for any of his money have to go through his lawyer and staff. It'd be fun to actually have a JWPP, something officially recognizable.

                In regards to the IL lotto rules, yea I thought that too. A lot of lotteries (including IL) have those specific rules. At first I thought that IL required the actual winner, the actual person, to attend those conferences and give up his/her name. But I just read a story about a family who won the Illinois Lotto (not a multi state, just the IL Lotto) from Tinley Park I think...and they successfully claimed via an LLC! There's a Chicago Tribune article on it. Their lawyer talks about the process of how they did it and the IL Lotto Commission let them claim that way. No one knows who they are or where they live. 

                 

                Thanks again for all the welcomes and comments! I'll promise I'll try to keep all the subsequent posts shorter.

                Pete!  excellent first set of posts!  and i actually made it through the first one quite easily!  thank you.  **whew** 

                claiming anonymously would be my choice, unfortunately my lil state (RI) does not allow it.  it allows you to form a LLC or trust, but YOU must still have your name and town published.  (you do not need show your face if you choose not to) 

                and allow me to add my voice in welcoming you to LP.  havent been here that long myself, but from what I have seen, its a great crew.