Lottery winners
 

Hopefully someone in the Villages wins! But what to do.......

1. take lump sum or 30 year payments, lump sum after taxes less than 50%

2. 30 year payments get 5% interest a year

3. How do you slit it with a bunch of folks without them being taxed again

4. Can leave payments to beneficiaries

if you have any knowledge or ideas on this please share ...........thanks, Merry Christmas

Florida doesn't impose tax on lottery winnings. I believe you can "gift" up to $25,000 per year, to any individual(s) you want, without them having to declare it as income. You also can't write it off as an expense, but if you donate to a registered charity you can write it off as a charitable contribution on your year-end tax return.

I checked with OmniCalculator and see this:

With a $984 million megamillions winning ticket, the lump sum payout would be $511,680,000.

Federal taxes would be $189,729,688.

So your net payout would be $321,950,312

Over a quarter of a billion dollars. Pretty sure when you win THAT big, you don't have much need to worry about taxes. You can afford to pay them. If you bought a summer home up north by a lake, upgraded your house here in The Villages, got a comfy adobe in Santa Fe for ski weekends, and spent a month every year in Venice Italy, bought yourself a new car and his-and-hers custom golf carts, you'd still have around $200 million after 10 years. You can give $25,000 to your son, AND his wife, AND each of their three kids, and your daughter, and HER husband, and THEIR twin boys, AND pay for your mom's long-term memory care housing and medical bills that medicare doesn't cover, and still have over $100,000 million left over. You can live off the interest of that and die with enough to set your kids and grandkids up with a nice cushion for their own - and THEIR grandchildren's lives.

The gift might be only $18,000 per year. UMTA is up to $18k/year for minors tax-free but the kid can't touch the money until he's at least 18 (up to 25, depending on how the paperwork is filled out when the account is created).

A lottery winner is taxed as income on the entire amount by the IRS. The receiver of gifted money is never taxed, regardless of the amount. A gift is not taxable income. There are estate taxes after death, but there are ways to avoid them by planned gifting while you are alive.

I have 2 friends who have won over $50M.

You take it in a lump sum, every financial advisor will tell you that.

You don't take it in your own name, you take it in pass through entity that doesn't have tax liability until distribution. 1000's of lottery winners "split" their lottery take.

Darn, if you win that your medicare monthly cost will go up the next year.

I would worry about that after the win. Which pretty unlikely with 365 million to 1 odds. But, if don’t play you have NO chance to win.:undecided:

yes, just cause the take 1/3 or more of winning don’t mean that will cover the taxes at end of year. That’s problem with lottery the federal government like to steal all of it thinking they won lottery and not individuals cause average Joe don’t know how to hide it. And of course any financial advisor not responsible if the make calculations error. First thing I would do start foundation (one of many tax breaks for rich to get out of paying taxes) and hire all my relatives paying them Hugh amount so I can deduct it claim lost so I can keep some.

I stand partially corrected. Connecticut (the state I'm from) has gift tax combined with estate taxes. There are also gift taxes paid by the person giving the gift to someone else, and it exists to prevent people from avoiding paying taxes on their own income. Wealthy people have to submit a form to the IRS when they gift anyone over $18,000 (per recipient per year), and there's a lifetime maximum they can give. It seems pretty complicated, but if you're that wealthy that you can afford to do all that stuff, you probably have an accountant to handle it and/or explain how it all works.

I wouldn't put too much faith in TOTV financial advice you're getting

Gifts are generally considered taxable.

Lottery winners are not "taxed on the entire amount". Potential taxes are withheld, but the taxes are not immediately due & payable and there are a myriad of ways to reduce your tax liability.

What I said was that the receiver of a gift is not taxed. There is a "unified gift and estate" tax that may be required to be paid by the giver or their estate, but not by the receiver of the gift. This is not income tax. In 2025, there is an annual gift tax exclusion of $19,000 per recipient for gifts. But, a gift tax is not owed until the lifetime exemption is exceeded. In 2025, the lifetime exemption is $13.61 million. So, if you give someone $20,000 in 2025, you need to file a gift tax form to notify the IRS that your lifetime exemption has decreased by $1,000, but neither you nor the recipient will owe any tax.

I like number 4 (are YOU —-ing me). Naturally people in charge writing laws would make that priority. I also love the inherent tax. Taxing stuff like property that’s AREADY had taxes paid for decades. O wait my children are considered new owner. :1rotfl: That makes all the difference:beer3:

Sure there many ways to get out of paying taxes that why there will NEVER be flat tax to much money to be made off getting out of paying taxes. :pepper2:

It’s only complicated for us peons who don’t have army of tax lawyers using the loopholes for rich so they can use deductions specially enacted for them.

If I win megamillions I'll happily pay whatever taxes I'm obligated to pay. I have nothing I can deduct to reduce my obligation, I have no investments or tax shelters, and my Intel stock has been tanking this year.

I'll give my sister a million, maybe a hundred thousand to each of his aids, and then set dad up in the swankiest full-service nursing/memory/palliative care place I can find. I'll probably donate a million to the battered women's shelter down in Leesburg, and maybe I'll pick up a bunch of Sonic gift cards and give them to those sign-waver folks who hang out begging in front of Walmart.

And then, I'm going back up to New England from late May til late September. Enjoy the fall foliage, the lilac trees in the spring, mountains and roadside farmstands and hot lobster rolls and buskers playing in Harvard Square and the subway and shopping and taking the T everywhere! I'll buy a new car down here, and a spankin tricked-out golf cart. Hubby will just have to miss me a couple months every year, he hates travel and I miss home too much to not go.

I'll stop worrying about being able to afford health insurance premiums. I'll get the best I can find, and get this damned hip replacement I've been needing for the past few years.

I'll still have enough left over that maybe I'll buy a ghost-town in the midwest somewhere, just for fun.

So says the hundreds that lost it all. You have no choice to try find honest tax advisor and hope he/she don’t steer you wrong or have sticky fingers. Think you have headaches now? The headaches over money will be ten fold.

Wish I had this problem :confused: :confused:

So a group of people put TAXED dollars into a hat and one person "wins" that pot. The government finds income here? How many times can they tax it? My lottery money goes into Canada eh. If I ever hit, I will buy a warm coat.

Actually both you and your wife can gift identical amounts.

Sooooo what you are saying is, there is a chance of winning!

I have no chance to win because I have never bought a lottery ticket. It is a bad investment. Although, there was a couple who figured out how to beat the system by waiting until the jackpot got so high and the lottery operators did not decrease the odds of winning to match the increased jackpot. There is a movie about the couple called "Jerry and Marge Go Large". True story.

It's not an investment. Its an entertainment answer to a dream. . . Eureka! the 1800's exclamation for finding a load of gold in the ground, same dream.

all retirement strategies should include a lottery strategy, low cost, high payoff, very tiny amounts, like once a year, for christmas stocking stuffers. Same with 8 play parlays in the NFL, 175 x the original bet. . . odds are low, payoff high. . minimal amounts of bets for entertainment, but random luck can hit changing one's life.

however, there are smaller odds lotteries with better odds with life changing money. FL Lotto has great odds, several million + payout. Put the FL lotto app on your phone and play that lottery for Christmas, buy an annual ticket, pick it and forget it.

If you are worried about winning too much money, take the 20 year payout.
If you are wanting to use it to gift to relatives etc, take the lump sum.

If you are worried about paying more in taxes or taxes at all, no one can help you.. . don't play

:ho::highfive:

To me, it is an investment. A bad one. No entertainment value whatsoever.

I would take the lump sum, I doubt I'll be here in 20 years...

Lottery winner!
 

Oh, for want of such "problems!" :a20: Merry Christmas.

They call buying a lottery ticket the Stupid Tax for a reason. However, throwing a couple bucks at it every blue moon is no big deal - kinda like knowing it's stupid to gamble, but tossing a couple quarters at the slot as you walk through the Vegas casino. Cheap entertainment for a short while.

I will give my sister a million
 

I think that would be taxed again, the question is how do you make her part of the payout so it is only taxed once.

If you had 50 people you wanted to give money too, can you make them part of the payout so the money isn't taxed twice?????:BigApplause:

20 years
 

I think its 30 years now!

Giving away a million dollars does not create a taxable event. See Post No. 10. Also, Google the unified gift and estate tax. You can give away up to $13.61 million with no tax due.

I'm starting from a position of someone who doesn't have any loans or mortgages, has a low-but-steady income, is still physically active, everything I possess is mine outright, my credit card debt is under $1000 and we pay it off in full every month. No significant savings, but we could afford to replace the roof if it started bending off (it's metal).

And then, to be a winner of megamillions - AFTER paying taxes receiving somewhere around $300 million? I am not concerned, at all, about tax advisors. I won't be able to spend the first $100 million in 5 years. If the IRS says they want another $100 million because I spent it wrong, it's fine. They can have another $100 million. I'll STILL have another $100 million left over and can live off the interest.

I’ll spread the wealth when I win it. 😉

A very wise family friend once told me the dream of winning was more fun than actually winning. There is some truth to this.

Be careful about what you wish for...

Rip up the winning ticket? 5 reasons why winning lottery can destroy lives

Again, when you give away money, there is no income tax owed by either the giver or the receiver of the money. You will not be taxed twice.

please double check that
 

doesn't sound like the federal govt??????????? I dont think you can gift 1 million dollars to someone, not a charity and it is non taxable by the feds.........

Actually none of you can win. Because I have the winning ticket. :boom:

That is the way a gift works, but maybe you should ask a tax professional.

When you give money to a charity, you get a tax deduction, but when you give money to a non-charity, you don't get a tax deduction, but the gift is not taxable income to anyone because you have already paid tax on it. You only pay tax on a gift when you exceed the requirements of the "unified gift and estate tax". This is not an income tax.

Take it all now!
 

if you’re over 55 years old, you might as well take it all in a lump sum now and spend it. You’re not gonna be able to enjoy it at age 85 if you’re even still alive.

Nothing I would worry about.
 

Multiple times I've played, i buy $20 auto lotto (they pick the numbers) and many times have only had a total of 1 or 2 numbers on the whole ticket. After probably $1,000 I'm done, not playing anymore.

of course, the odds are very high that you will lose, the odds to win are extremely miniscule. However, it's more about consistency, which means one pick for a year.

And if you win, just take the yearly amount. that way you can blow it all and then still have another year to try to not lose it all again. . practice makes perfect

So its like 100 picks in a year, 2 per week.

so I bought $300 in scratch tickets once, and the payout ratio is about 60% of the total, which is about which all $300 produced, which is about $180 back after spending $300, i think i actually got $160.. .

One doesn't go to the casino and expects to win, one goes to the casino and hopes to win!

Can’t win if you don’t play.
 

You know what they say:
“You can’t win if you don’t play-
But your odds are almost statistically the same”