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Claiming winnings in a lottery pool

Topic closed. 1 reply. Last post 12 years ago by ThinkBig.

Page 1 of 1
Baton Rouge, LA
United States
Member #4602
May 7, 2004
700 Posts
Posted: July 23, 2004, 2:40 pm - IP Logged

Presently, me and a coworker are doing a Lotto pool together.  I checked the claim form for my state and only one person can claim a prize.  If we win, one will get stuck with the taxes, and that isn't right.  I'm trying to figure out the best way to claim it tax wise if we win.

I've seen a few things about getting a Federal Tax ID number and claiming it as an entity, then distributing the winnings between the us, and turning over some to the IRS. 

The particular game we're playing doesn't have an annuity option, so that isn't an issue.  Looking for some advice on how to handle this.




    Southeast USA
    United States
    Member #3660
    February 9, 2004
    65 Posts
    Posted: July 23, 2004, 10:29 pm - IP Logged

    Here is something I got in the email concerning lotto pools. Actually, this was from two different lottery officials. Hope this helps....

    1. Most states only issue a single check.  If you split a ticket and win, you should form a partnership, call the IRS for a tax number, before cashing the jackpot winning ticket.  The state would then pay the partnership, the partnership would split the money and report that split to the IRS.

    2. The Lottery only allows one individual to claim a prize unless it's
    being claimed by a Lottery club.  The club members split the winnings
    and each receive a separate W-2 form in January for tax purposes.  The
    following is instructions on forming a Lottery club.

    Lottery clubs are required to register with the IRS to get a tax ID
    number and there are federal requirements involved in that process, but
    there are no state statutes that deal specifically with Lottery clubs.
    Lottery club members are on their own to establish partnership rules,
    whether those be written or verbal.  Effective October 1, 2003, the IRS
    allows clubs to apply for a federal tax ID number over the telephone.
    The toll free numbers is 1-800-829-4933. The FEIN # is given directly
    over-the-phone and the confirming paperwork is mailed to the Club