[SHIBUMI]

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

[OrangeBlossomBaby]

Originally Posted by SHIBUMI

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).

[retiredguy123]

Originally Posted by OrangeBlossomBaby

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.

[BrianL99]

Originally Posted by SHIBUMI

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

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.

[vintageogauge]

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

[Topspinmo]

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.

[Topspinmo]

Originally Posted by retiredguy123

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.

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.

[OrangeBlossomBaby]

Originally Posted by retiredguy123

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 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.

[BrianL99]

Originally Posted by SHIBUMI

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

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

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.

[retiredguy123]

Originally Posted by BrianL99

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.

[Topspinmo]

Originally Posted by BrianL99

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.

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. That makes all the difference

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.

[Topspinmo]

Originally Posted by OrangeBlossomBaby

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.

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.

[OrangeBlossomBaby]

Originally Posted by Topspinmo

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.

[Topspinmo]

Originally Posted by OrangeBlossomBaby

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.

[Byte1]

Originally Posted by SHIBUMI

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

Wish I had this problem