There are different types of lawyers you’ll want to look for after winning the lottery. A tax lawyer, trust and estate attorney, and asset protection lawyer are just a few examples. Ideally, you'll want just one lawyer who can fulfill all those roles.
What Lottery Lawyers Do for Jackpot Winners
Well, yes. They're not absolutely necessary, but a good lottery lawyer can keep you from making bad decisions that could jeopardize you or your wealth. They'll be there to stop you from making common mistakes that cause lottery winners to go broke. The larger your prize, the higher the stakes, and the more sense it makes to hire a lottery lawyer who can help you manage it all. Besides, it's not like you wouldn't be able to afford them anyway.
That is why he shared nine critical tips for lottery players, which include:
That big win comes along with a substantial tax bill that needs to be rectified, either right away or during tax season. If this is not completed, you are looking at a fine and an audit, which could result in even more money lost.
Irrevocable trusts protect lottery winnings because the assets legally do not belong to you. They also benefit your survivors as they are not subject to estate taxes. Blind trusts are also suitable as they protect your winnings from unscrupulous relatives and friends who want your property.
The Lotto legal department recommends that lottery winners seek out one or more of the following: a tax planner, a financial adviser, a certified public accountant and an attorney.
9 Smart Ways To Spend Your Lottery WinningsWait to Share the Good News. ... Take Time to Reflect. ... Hire Legal & Financial Consultants. ... Pay off your Debt. ... Start an Emergency Fund. ... Set Aside Money for Retirement. ... Choose Low-risk Investments. ... Make a Social Impact.More items...
If someone were to ask you what you would do once you become a Powerball winner, you might say, "quit my job" or "buy a mansion." However, experts suggest that you don't make any big moves immediately.
If the lottery administrators will distribute your winnings to you in lump sum and you don't trust yourself to manage them, you can set up the trust so that funds are distributed to you over time, and grant the trustee the authority to invest trust assets without your knowledge or consent.
A lottery winner can make a gift of some of the lottery winnings. This is legal only up to the annual exclusion limit, or else it will need gift tax liability. Making yearly gifts in this fashion is a good way to share the winnings with family members and friends while mitigating the tax implications.
Powerball, for example, offers winners the choice of a lump-sum payout or an annuity of 30 payments over 29 years. Mega Millions offers lump-sum payouts or annuities. The annuity offers an initial payment followed by 29 annual payments. Each payment is 5 percent larger than the previous one.
Take a deep breath and take your time. You have a set amount of time to turn in your ticket, so don't run off to the lottery office first thing the next morning. Let yourself calm down, and then set to work carefully forming your team and plans before you contact the lottery officials.
Currently, that amount is about $5 million a person. Any property given away over that is taxed at the rate of 35%. So by claiming the lottery winnings as a family partnership, a winner can claim that they are not making a taxable gift, because it was a family investment. This could save millions in gift taxes.
If you elected the cash option or if your prize is only offered in a single payment, your check should arrive approximately six to eight weeks from your claim date. If your prize is to be paid in installments, your first payment should be available within six to eight weeks from your claim date.
Florida, South Dakota, Texas, Washington, Tennessee, and Wyoming don't impose any income tax at all, so your winnings are safe here. The IRS additionally imposes a 25% federal withholding rate from lottery winnings.
An irrevocable trust is simply a kind of trust that cannot be changed or canceled after the document has been signed. This sets it apart from a revocable trust, which can be altered or terminated and only becomes irrevocable when the trust maker, or grantor, dies.
The Bridge Trust® The Bridge Trust® is a special type of irrevocable trust which can both protect your assets, while keeping them available for YOU to use. It also has a simple “grantor trust” tax status, which means there is no need for an additional tax return or layer of trust taxes.
4-6 weeksPlease allow 4-6 weeks for claims that are mailed in to be processed. Above $5 Million, all Lotto Texas®, Powerball® and Mega Millions® jackpot prizes, and prizes paid by annuities must be processed at Texas Lottery headquarters in Austin.
They can protect you from potential lawsuits and counsel you in such events. A good lottery lawyer will help you find legal ways of minimizing your tax liability. They'll also be able to assist you in setting up a trust or other legal entity to claim your winnings, if you need to.
Some of the benefits of hiring a lottery lawyer are: They can help you keep as much of your winnings as you legally can. They can help protect your identity. They can introduce you to the right people. They can set up your estate for your family's future.
What to Look For When Choosing a Lottery Attorney. You should take your time when looking for a lottery lawyer. The difference between a good lawyer and a bad one can easily cost you your money, time, and worse. Choose from different candidates, so you can find the best one.
If you won the lottery, the first person you want to hire: an attorney. That’s right, just one. It’s true that you’re going to need all sorts of lawyers who specialize in taxes, trusts, estates, and the like. But, you don’t really need to hire an entire cavalcade immediately.
Among his most notable clients include Maureen Smith and David Kaltschmidt. The married couple is better known as 1/3 of the winners of the $1.58 billion Powerball jackpot back in January 2016. On top of providing legal counsel, Panouses also acts as the defacto PR person for the couple.
Well, yes. They're not absolutely necessary, but a good lottery lawyer can keep you from making bad decisions that could jeopardize you or your wealth. They'll be there to stop you from making common mistakes that cause lottery winners to go broke.
Walt Blenner. Walt Blenner (inset) and client Shane Missler. Practicing out of Tampa Bay, Walt Blenner is a personal injury lawyer who also dabbles in estate planning. And yes, he also represents lottery winners.
Big lottery winners may feel overwhelmed by the number of decisions they have to make before they even claim a jackpot. To make things even more confusing, each state that participates in the lottery has its own procedures for claiming a prize and for minimizing tax liability. That's why a lawyer's help really comes in handy.
If you've just won a bundle of cash, you might balk at giving a big chunk of it to a lawyer right off the bat. However, hiring a good lawyer really pays off in the long run. Here are some examples of what lottery lawyers do for jackpot winners:
Winners spend a lot of time with their financial team, so it's important to find someone they trust and feel comfortable with. And of course, the lawyer should be familiar with the unique problems lottery winners face.
If you win a large prize in a lottery, getting a good lawyer should be a priority. You'll want to have representation before you tell anyone outside of your immediate circle of family and trusted friends that you've won, and certainly before you claim your prize.
John is the main author and editor of lottolibrary.com since 2019. He's a long time lottery player who has a specific interest in coming up with and testing various lottery strategies as he's always been obsessed with math, statistics, and probability theory.
While there are states that will let lottery winners claim their prize anonymously, or in the name of a business, there are states that will not. A good lottery lawyer can help protect a winner’s identity and personal information as much as possible.
As mentioned above, you will be spending a considerable amount of time with your lawyer before, during, and after you claim your lottery winnings. Therefore, it is vital that you partner up with someone who you jive with and who jives with you.
While we would love to think that if we win 20 million dollars that we would be handed over that exact amount, we mostly all realize that is not the case. That big win comes along with a substantial tax bill that needs to be rectified, either right away or during tax season.
We have all seen the news stories: Local Woman Wins Big Earnings at Her Nearby Gas Station. It is no surprise that the entire community (the whole country, even!) gets excited when there is a lottery winner. It is almost as if they won the prize along with the winner.
If you win a substantial amount of money, you will likely need some legal documents drawn up to see how to best protect your newfound bounty. You will want to put protections in place for yourself and any recipient of the prize money that you choose.
You may ask yourself why would I find myself in the midst of a lawsuit? Unfortunately, as we said earlier, there are many people who are looking to capitalize on another person’s gains.
Winning the lottery is an exciting and once-in-a-lifetime event. It can come at a moment’s notice and most of the time, we purchase our tickets and think that there is no way that it will actually happen to us. We purchase it with a dream and a hope and a dose of reality.
3 People You Must Hire After a Lottery Win 1 The Attorney. This is the first person to hire. An attorney can help you keep the ticket safe until you have your team in place to help you handle your winnings. An attorney may advise you to set up a trust and transfer “ownership" of the ticket to the trust, for which you are the sole trustee. You’ll still receive your winnings, but the trust can save you on taxes. 2 The Financial Advisor. This person will help you set up accounts that keep your money growing in order to guarantee a safe income for you throughout your lifetime. A financial advisor will also investigate any financial investment requests that you will receive from family, friends or people you’ve never heard of, but who will assure you that you can make millions more with their method or product. 3 Accountant. This person will handle all the tax matters and keep you out of trouble with the IRS. After the government takes their initial cut, there are still more taxes to pay.
The Attorney. This is the first person to hire. An attorney can help you keep the ticket safe until you have your team in place to help you handle your winnings. An attorney may advise you to set up a trust and transfer “ownership" of the ticket to the trust, for which you are the sole trustee.
Powerball tickets are sold in 44 states, as well as in Washington, D.C., the U.S. Virgin Islands and Puerto Rico. As of last time we looked, all but six states require lottery winners to come forward publicly. Delaware, Kansas, Maryland, North Dakota, Ohio and South Carolina allow winners to remain anonymous. Many other states are in the process of enacting such laws- some may even require you to donate some money to charity if you want to remain anonymous. Other states permit winners to create limited liability companies, so that when their names have to be announced, it’s the companies and not individuals that are identified. Think seriously about that.
You may need to add “member,” “partner” or “trustee,” etc. You won’t get paid for a month or so, according to most sources. This not only gives you time to get things in order, but can be an excruciating wait.
You won’t believe the tax issues which could come up- state taxes, federal taxes, gift taxes, corporate taxes and other taxes even the game Monopoly didn’t try to make up. The lawyer can help with this, as they have a fiduciary (financial) duty to you.
An attorney could be necessary because people would pour out of the woodwork attempting to seperate you from your new found wealth.
While many people think winning the lottery is a dream come true, it’s also a curse with enormous responsibility that will require a great deal of courage and great professional advice to allow you to enjoy the winnings.
Turns out claiming a lottery prize anonymously is really hard. Unless you happen to live in one of six states - Delaware, Kansas, Maryland, North Dakota, Ohio and South Carolina - you are not permitted to claim the lottery prize anonymously.
Stay anonymous, if possible. Another reason to hire a lawyer first is for help creating an entity, such as a revocable living trust or a family limited partnership that masks your personal identity.
More pertinent is your age. The biggest payout to a single Powerball winner occurred in May, when an 84-year-old widow from Florida took her $370 million pretax payout at once.
The latest Powerball jackpot is worth about $400 million, the fourth largest jackpot in the history of the game.
Protect your ticket. Sign your winning ticket, make copies of it and stash the original in a safe-deposit box. If you are separated from the ticket, your signature should ensure you won’t be separated from the prize. The safe-deposit box will help ensure you’re not separated from it. Get help before you claim the prize.