Will Latest Group Lottery Winner Be Affected by Taxes?
There is nothing quite like winning the lottery. In almost all cases lotto winners go from rags to riches overnight. There is definitely a thrill and exhilaration that comes with becoming an instant multi-millionaire. Who wouldn’t want to win the lottery? Hold that thought. Winning the lottery comes with several possible catches that could lead to tax trouble. In fact, for some lottery winners, the tax fallout is a real nightmare.
The tax headache can be especially big when several people decide to purchase lottery tickets together, as a group, which is exactly what happened to some recent lottery winners in Tennessee. Twenty co-workers won a $420.9 million Powerball jackpot in November, with the lump sum payment being $254 million. Split evenly, each winner will receive $12.7 million before taxes.
However, the first question that must be answered is could this group be considered a real partnership? The 20 winners have been pooling their money together for eight years, so it’s a legitimate question. It’s also an important one as it could make a big difference in how they report it and their overall tax bill.
Another question is could their agreement be viewed as a trust? If the IRS considers it a grantor trust it’s simply taxed as a flow-through. However, if it is a more complex trust that is taxed the same as a corporation the tax headache can be huge and expensive. So, what should you do if you become an instant millionaire? If you ever end up choosing the right numbers, the smartest thing to do is talk with a qualified tax professional before you even collect the money. This will help you avoid several possible headaches.
http://www.forbes.com/sites/robertwood/2016/12/01/20-plant-workers-420-million-powerball-win-cleverly-misses-tax-mess/#3a6f0e555f29
The Four Primary Functions of CEO Leadership
The Four Primary Functions of CEO Leadership By Rick Johnson The majority of effective functions of a CEO/President leaders seem to be natural visionaries. Although, I admit, that there are successful leaders that can’t see past lunch. However, those leaders without the vision that are successful are successful because they have the unique ability to…
10 No-Cost Ways to Recognize Employees
10 No-Cost Ways to Recognize Employees By Marjorie Treu 1/21/2009 Turn on any nightly newscast and you will hear the doom-and-gloom predictions of an economic recession just around the corner. Reactions inside organizations run the gamut from “Things are great. Go Team Go!” to “Stop all spending now!” based on manager leadership styles and their…
Seven Qualities of a Good Leader
Seven Qualities of a Good Leader By Barbara White How often have you heard the comment, “He or she is a born leader?” There are certain characteristics found in some people that seem to naturally put them in a position where they’re looked up to as a leader. Whether in fact a person is born…
How Leaders Can Take Charge of Change
By Jennifer J. Salopek It’s easy to just say people “resist change.” The reality is that you can create an environment where a change initiative won’t encounter harsh skepticism. TechnologyOur firm may be introducing Web-based training, a knowledge-management system. Whatever the flavor of the month, new technology can create real resistance in your workforce —…