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billionaire2bee

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May 21, 2013, 11:30 am

So if you hit the jackpot and want to give friends and family some money...can't you just give them cash so they wont have to pay the gift taxes? Like if I had of won one of the past two jackpots, I would have just got maybe a million in cash and handed out different amounts to friends and distant family....Would they be exempt from the taxes then???
rdgrnr

100

The Hall Of The Mountain Kings Tennessee
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May 21, 2013, 12:01 pm

The IRS probably won't bother you unless you're on the President's Enemies List.

Like me.
Saylorgirl

Indiana
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May 21, 2013, 12:44 pm

Quote: Originally posted by billionaire2bee on May 21, 2013
So if you hit the jackpot and want to give friends and family some money...can't you just give them cash so they wont have to pay the gift taxes? Like if I had of won one of the past two jackpots, I would have just got maybe a million in cash and handed out different amounts to friends and distant family....Would they be exempt from the taxes then???

It just depends on how they spend the cash you would give them. If all of a sudden they are putting a large amount of cash in the bank or on a brand new car it could be a problem. Anything over $10,000 in cash being deposited is reported to the government.
JoshUK

London
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March 24, 2013
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May 21, 2013, 12:47 pm

A man in the UK hit the jackpot and then told the lottery that he was a family syndicate to avoid the taxes on gifting.

£2.50 and a dream!
savagegoose

adelaide sa
Australia
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April 11, 2006
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May 21, 2013, 5:25 pm

tjhe tax office will notce $1 million turning up in peoples bank accounts. nothing to say you cant employ them and hand over an expense account, with saya credit card that gets topped up ea month.

" Still swinging, still missing "
2014 = -1016; 2015= -1409; 2016 = -1171; 2017 = -1257 ; 2018 = - 1380 = TOT = - 6233

keno historic = -2291 ; 2015= -603; 2016= -424; 2017 =-427; 2018= -223 TOT = -3968

:
yoho

Toronto
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January 26, 2013
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May 21, 2013, 6:06 pm

My question is, why would you give millions of dollars away? I mean if you're giving away a few thousand, there's no problem. You aren't taxed anyway.

The tax is only a problem when you're giving away huge amounts. But why would you give away huge amounts in the first place?

It's not like I'm so greedy I won't even give my parents money. No. But the thing is, if lottery winners need so much financial and legal advice with their

windfall, wouldn't people who received millions from lottery winners need it as well? It will take a lot of time and effort to learn and understand the complex

financial and legal consequences and responsibilities, as well as how to invest the money properly while making a decent, and safe gain that fits your own

needs.

Not everyone is cut out to become a financial expert. Or even learn to manage their own finances well.

If I had a really close-knit group of people (family, friends, w/e) whom I share a mutual trust with, there would be no need to just "give" them money. Instead,

it would make more sense to have a single or two people burden the responsibilities of the huge amount of money, taking the time to learn to manage it

instead of hiring dozens of financial adviors each nimbling away at the money for no good reason.

If for example, they wanted a house, you could simply buy it and let them live in it. Because of the trust you share, it shouldn't be a problem that it's under

your name and not theirs. In fact, if I were really to win a 50million+ jackpot hard cash (since canada doesn't have tax on lottery winnings, and no annuities)

I'd buy a huge plot of land so that my closest family can all build their dream homes there and we all could live together. Then any money they need, you can

easily give for example buying groceries together and you pay, etc.

That's how I feel, but I might be too naive.
savagegoose

adelaide sa
Australia
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April 11, 2006
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May 21, 2013, 6:15 pm

but you may find they need more and more money. id prob give ones i cared about a credit card with a monthly loading. and terll them dont ovver draw it or it gets cancelled. and wont be renewed for 3 years. that way they could hang around, and not be bugging me to buy stuff fo them all the time.

" Still swinging, still missing "
2014 = -1016; 2015= -1409; 2016 = -1171; 2017 = -1257 ; 2018 = - 1380 = TOT = - 6233

keno historic = -2291 ; 2015= -603; 2016= -424; 2017 =-427; 2018= -223 TOT = -3968

:
yoho

Toronto
Canada
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January 26, 2013
179 Posts
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May 21, 2013, 6:28 pm

Quote: Originally posted by savagegoose on May 21, 2013
but you may find they need more and more money. id prob give ones i cared about a credit card with a monthly loading. and terll them dont ovver draw it or it gets cancelled. and wont be renewed for 3 years. that way they could hang around, and not be bugging me to buy stuff fo them all the time.

Maybe I'm just very fortunate. But none of my close family (parents, grandparents, aunts and uncles) would act like that. Some of them are quite well off

already, and they don't spend like there's no tommorrow.

But if I had a close family member who can't control their spending, I would DEFINITELY NOT give them a cent to allow them to indulge in their bad spending

habits. I wouldn't support anyone's gambling or drug addictions. Giving them the money is tempting them to do wrong, I would never do that.
gogidolim

Inland Empire
United States
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October 22, 2011
327 Posts
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May 21, 2013, 7:37 pm

So what's the actual percentage of tax for the jackpot in CA? There's no state tax but I don't know where this 35% tax thing came from.
billionaire2bee

United States
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July 25, 2012
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May 21, 2013, 8:02 pm

Quote: Originally posted by yoho on May 21, 2013
My question is, why would you give millions of dollars away? I mean if you're giving away a few thousand, there's no problem. You aren't taxed anyway.

The tax is only a problem when you're giving away huge amounts. But why would you give away huge amounts in the first place?

It's not like I'm so greedy I won't even give my parents money. No. But the thing is, if lottery winners need so much financial and legal advice with their

windfall, wouldn't people who received millions from lottery winners need it as well? It will take a lot of time and effort to learn and understand the complex

financial and legal consequences and responsibilities, as well as how to invest the money properly while making a decent, and safe gain that fits your own

needs.

Not everyone is cut out to become a financial expert. Or even learn to manage their own finances well.

If I had a really close-knit group of people (family, friends, w/e) whom I share a mutual trust with, there would be no need to just "give" them money. Instead,

it would make more sense to have a single or two people burden the responsibilities of the huge amount of money, taking the time to learn to manage it

instead of hiring dozens of financial adviors each nimbling away at the money for no good reason.

If for example, they wanted a house, you could simply buy it and let them live in it. Because of the trust you share, it shouldn't be a problem that it's under

your name and not theirs. In fact, if I were really to win a 50million+ jackpot hard cash (since canada doesn't have tax on lottery winnings, and no annuities)

I'd buy a huge plot of land so that my closest family can all build their dream homes there and we all could live together. Then any money they need, you can

easily give for example buying groceries together and you pay, etc.

That's how I feel, but I might be too naive.

Wait wait wait back up and re-read what I actually said LOL...I said I'd take out a miilion in cash and distribute different ammounts...Im not giving away or rather wouldnt if I have it to give millions LOL
PlayToWin47

Joplin MO
United States
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January 28, 2013
190 Posts
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May 21, 2013, 10:50 pm

Quote: Originally posted by billionaire2bee on May 21, 2013
So if you hit the jackpot and want to give friends and family some money...can't you just give them cash so they wont have to pay the gift taxes? Like if I had of won one of the past two jackpots, I would have just got maybe a million in cash and handed out different amounts to friends and distant family....Would they be exempt from the taxes then???

It would be hard to say. It depends on how closely the IRS watches you.

Technically, by law, they're not exempt from the gift tax. If you're giving cash to them ... once you have given $14,000 (as of Jan. 2013) per person, anything over that is subject to the gift tax ... paid by you! If you gave it to them under the table, and they didn't go doing things that could be tracked ... like buying cars/etc., putting it in the bank, etc. ... AND if the IRS wasn't watching close enough, you MIGHT get away with it.
joshuacloak

United States
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February 12, 2006
711 Posts
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May 21, 2013, 11:33 pm

its called a trust

trust trust trust trust

if u won pb/mm levels of money

a lawyer can set it up/claim it for

and if irs ever ask's why your best friend just had 2 million dropped into hes bank account

show them trust, with hes name on it

issue fixed, gift taxes bypassed

gift taxes are wrong, just like death tax is

i have right to give everthing i have to whoever i want, whenever i want, without a other human being coming in middle of me and whoever am giving it too

even more so do i have the right to give stuff to my kids, but not to IRS, the kids get anything that amounts to millions

and here comes there hand,

the evil tax the rich folks have got what they always wanted, to steal money form parents trying to give there kids the money they spent a lifetime earning to pass on to kids/grandkids

what irs does and govt does is very WRONG, and anyone who supports what they do is scum of the earth

the fact is govt got its taxes paid first time u claimed the money/or earned the money in a job etc

u have ever right to give it away tax free, its already been taxed

anyone who thinks gift tax or death tax is okay, can go burn in hell ,

lucky its easy as hell to give people things in more creative ways

u know them show's where they remodel your house for u

they get around gift tax laws easy

they "rent" your home, and if renter happens to make house better/add's to its value, its not taxed

for lottery winners, just write a freaking trust, have trust claim the money

however many names u want on it, how much they would or "can" get in future

u can write it however u wish

this is like 50th gift tax topic i seen

why do i people not research this

its simple, if u win large jackpot

step 1, go to lawyer, google search for best ones in your area, think a little bit on this HARD

step 2, tell lawyer what u want to do and why

step 3, allow lawyer to freaking handle this

any lawyer worth hes cost will set up a trust or something like it

that allow u to give however much money U WANT to however u want, gift tax free

its already been taxed first time, why play the greedy people more , and get double taxed

for god sakes people wake up and use your brain's

One tequila, two tequila, three tequila, floor.
HoLeeKau

Idaho
United States
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July 17, 2010
2,453 Posts
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May 21, 2013, 11:35 pm

Quote: Originally posted by PlayToWin47 on May 21, 2013
It would be hard to say. It depends on how closely the IRS watches you.

Technically, by law, they're not exempt from the gift tax. If you're giving cash to them ... once you have given $14,000 (as of Jan. 2013) per person, anything over that is subject to the gift tax ... paid by you! If you gave it to them under the table, and they didn't go doing things that could be tracked ... like buying cars/etc., putting it in the bank, etc. ... AND if the IRS wasn't watching close enough, you MIGHT get away with it.

Until one of them gets mad because you're not forking over enough money, or gets mad for other reasons and turns you into the IRS.

I believe it's the giver's responsibility to pay the gift tax, so you'd be the one in the pokey.
dager

New Orleans
United States
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May 29, 2013
36 Posts
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May 30, 2013, 11:20 am

The way the bank watches you is another issue aside from the IRS. The banks don't want to get cited for internal compliance shortcomings. They probably have enough dirty business of their own to cover up without having to worry about their clients.

Some banks start an investigation on their own, and report to the IRS if they start seeing strange (for your account) deposits or withdrawals. If you don't typically have $50,000,000 in the bank and make regular large withdrawals and you suddenly win a lottery you'll most likely be flagged and watched to see how much cash your withdrawing on a regular basis. They know people want to avoid taxes, and they don't want to be cited in an audit.

Say you want to give someone $60,000 you obviously can't write a check to them without dealing with taxes, but even if you start withdrawing $5000 a month to add up to 60,000 at the end of the year it might still look suspicious if it isn't part of your regular spending habits. Even further than that the person you're giving the money too would have to keep it as cash and never deposit it into any financial institution that reports to the IRS.
billionaire2bee

United States
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July 25, 2012
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May 30, 2013, 11:38 am

Quote: Originally posted by dager on May 30, 2013
The way the bank watches you is another issue aside from the IRS. The banks don't want to get cited for internal compliance shortcomings. They probably have enough dirty business of their own to cover up without having to worry about their clients.

Some banks start an investigation on their own, and report to the IRS if they start seeing strange (for your account) deposits or withdrawals. If you don't typically have $50,000,000 in the bank and make regular large withdrawals and you suddenly win a lottery you'll most likely be flagged and watched to see how much cash your withdrawing on a regular basis. They know people want to avoid taxes, and they don't want to be cited in an audit.

Say you want to give someone $60,000 you obviously can't write a check to them without dealing with taxes, but even if you start withdrawing $5000 a month to add up to 60,000 at the end of the year it might still look suspicious if it isn't part of your regular spending habits. Even further than that the person you're giving the money too would have to keep it as cash and never deposit it into any financial institution that reports to the IRS.

Also depends on how big of account you have....banks rarely want to piss off big account holders...whatever the compliances rules are...