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New Library Definition - Cash Option

Topic closed. 6 replies. Last post 14 years ago by Todd.

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Vote Yes to add the definition as written.

Yes [ 12 ]  [92.31%]
No [ 1 ]  [7.69%]
Total Valid Votes [ 13 ]  
Discarded Votes [ 1 ]  
Todd's avatar - Cylon 2.gif
Chief Bottle Washer
New Jersey
United States
Member #1
May 31, 2000
23273 Posts
Online
Posted: April 6, 2003, 10:57 am - IP Logged

Cash Option

Also, Lump-Sum Option

One of the two typical ways a lottery prize is paid (the other being Annuity).

When a lottery prize is paid with the Cash Option, the winner receives one large payment from the lottery, usually within a few weeks of redeeming the winning ticket.  Applicable taxes are normally withheld prior to the payment, although the winner may be responsible for additional taxes after receiving the prize, depending upon their situation.

Although most government lotteries allow the winner to choose the cash option within 60 days of the drawing, some juridictions do not allow this option.  Therefore, players who wish to exercise the cash option in those jurisdictions must select the cash option when they purchase their lottery ticket.

The cash value in a lottery is typically 50% - 60% of the corresponding annuity value.  This, plus the fact that most lotteries place a heavy emphasis on the higher annuity value, leads many people to believe that the cash value is derived (calculated) based on the annuity value.  However, the opposite is true

The cash value is the actual amount that the lottery has in its prize pool after the total lottery proceeds are divided into administrative overhead, marketing costs, government programs, and the prize pool.  The annuity value is then calculated from the available cash value, based on prevailing interest rates (see "Annuity" for more information).


    United States
    Member #379
    June 5, 2002
    11296 Posts
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    Posted: April 7, 2003, 7:41 pm - IP Logged

    Todd: Sorry I didn't explain it the way you did.

      Todd's avatar - Cylon 2.gif
      Chief Bottle Washer
      New Jersey
      United States
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      May 31, 2000
      23273 Posts
      Online
      Posted: April 7, 2003, 8:06 pm - IP Logged

      I just took your info and rearranged it a little.  Just trying to make everyone happy.

       

      Check the State Lottery Report Card
      What grade did your lottery earn?

       

      Sign the Petition for True Lottery Drawings
      Help eliminate computerized drawings!


        United States
        Member #379
        June 5, 2002
        11296 Posts
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        Posted: April 9, 2003, 8:49 am - IP Logged

        See this one yet, AnnuityIsFunny?


          United States
          Member #1047
          January 17, 2003
          348 Posts
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          Posted: April 9, 2003, 10:24 am - IP Logged

          So, CashOIdon'tKnowTheDefinitionOfCashOption:

          So, now you're taking credit for Todd's work?  Next thing you're gonna say is that this website was your idea....  Must be the lumpsum you took over your troubled head too many times.  You wouldn't be like this if you preferred Annuity.

          Don't blow all your winnings in one place - Choose Annuity


            United States
            Member #379
            June 5, 2002
            11296 Posts
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            Posted: April 9, 2003, 10:43 am - IP Logged
            AnnuityIsPhony:

            Every time you've won money through the lottery, you've been paid in LUMP SUM.

              Todd's avatar - Cylon 2.gif
              Chief Bottle Washer
              New Jersey
              United States
              Member #1
              May 31, 2000
              23273 Posts
              Online
              Posted: April 11, 2003, 3:29 am - IP Logged

              "Cash Option": officially voted in.

               

              Check the State Lottery Report Card
              What grade did your lottery earn?

               

              Sign the Petition for True Lottery Drawings
              Help eliminate computerized drawings!