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View Diary: dailykos lotto pool thread III, Powerball is 400 Million (30 comments)

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  •  I'm in too (4+ / 0-)

    25-46-47-48-49 PB 34

    Has anyone considered the tax implications of this pool? Suppose I win a $400M jackpot. They hold back a lot for the immediate payout, and I have to pay tax on the rest. None of this is part of the split, of course. Say I end up with $200M, and 101 Kossacks participate (including me). I now owe 100 people $1M each, right?

    But if I just write 100 checks for $1M to individuals there will be almost $14M in gift tax to pay. Presumably each participant pays their own, taking home only $860,000. Is this what we have in mind?

    Jeez, for only $860,000 it's hardly worth it. Chump change. You can't even buy a politician for that nowadays.

    •  The winner should engage an attorney (6+ / 0-)

      The winning ticket - I think - must be "held/owned" and turned in by all the winners with each persons' social security number so that each person is taxed on their portion of the winnings. Negating the gift tax issue.

      Anyone have another explanation?

      I'll take $860K - you could buy a lot of little down-ballot races and start to get the tea-partiers out of local government.

      America is a COUNTRY, not a CORPORATION. She doesn't need a CEO. Vote Obama.

      by manneckdesign on Wed Sep 18, 2013 at 10:54:24 AM PDT

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    •  ends with space - there is a structure that (0+ / 0-)

      will optimize the payout and tax implications that we can pursue, if we are fortunate enough to win. It would likely mean setting up a limited partnership or some other pass through entity that would take in the jackpot and distribute the proceeds. Informal syndicates win these jackpots with enough frequency that there is likely a model to follow.

      "let's talk about that"

      by VClib on Wed Sep 18, 2013 at 02:36:33 PM PDT

      [ Parent ]

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