If you won the lottery tomorrow

[Stadler]

Seen elsewhere...


The lottery is probably the only time a billionaire has to pay a fair share of taxes.

Which is not an indictment on billionaires, but rather an indictment of the lottery system.  That's why real billionaires don't play the lottery.  They have better ways of making money in a manner that allows them to decide what to do with it as opposed to turning over chunks of it to the government.

It's more an indictment on the system in general, in that 'real' billionaires have built up layers and layers of govt provided tax loopholes that allow them to avoid paying what someone who is suddenly in their class doesn't have. It kind of blatantly shows how the tax code is geared towards those who already have excessive amounts of money.

I don't at all mean this to be dismissive of you rather to reflect the thread title, but that's one way of looking at it.  It's focusing on one variable (strictly income taxes) at the exclusion of all others.  Billionaires pay far in excess of what I do on property taxes, sales taxes, capital gains taxes. Billionaires contribute far more than I do (or can do) to charitable causes or other deductible endeavors.  And of course, the top 1% pays about 40% of all income taxes.  Not sure what's unfair about all that.  If one chooses to look at it as an incentive rather than a penalty, it changes the analysis.

[TAC]

Seen elsewhere...


The lottery is probably the only time a billionaire has to pay a fair share of taxes.

Which is not an indictment on billionaires, but rather an indictment of the lottery system.  That's why real billionaires don't play the lottery.  They have better ways of making money in a manner that allows them to decide what to do with it as opposed to turning over chunks of it to the government.

It's more an indictment on the system in general, in that 'real' billionaires have built up layers and layers of govt provided tax loopholes that allow them to avoid paying what someone who is suddenly in their class doesn't have. It kind of blatantly shows how the tax code is geared towards those who already have excessive amounts of money.

OK, Bernie Sanders

It really shows that if you win the lottery, you really need a financial advisor and/or a tax specialist.

I mean, it's not like the lottery is making billionaires out of people. Plus, I would think the majority of lottery winners are doing just fine. Sure, I'm sure there are a bunch of meatheads that win and fuck themselves over. Happened to a guy in my hometown, actually.
But I also had a family member become a millionaire through lottery winnings, and they continued to live rather meagerly.

Honestly, I'm not sure what the tax code has to do with this discussion, other than to say that if you do fall into a bunch of money, you should take steps to protect yourself.

[Adami]

Seen elsewhere...


The lottery is probably the only time a billionaire has to pay a fair share of taxes.

Which is not an indictment on billionaires, but rather an indictment of the lottery system.  That's why real billionaires don't play the lottery.  They have better ways of making money in a manner that allows them to decide what to do with it as opposed to turning over chunks of it to the government.

It's more an indictment on the system in general, in that 'real' billionaires have built up layers and layers of govt provided tax loopholes that allow them to avoid paying what someone who is suddenly in their class doesn't have. It kind of blatantly shows how the tax code is geared towards those who already have excessive amounts of money.

OK, Bernie Sanders

It really shows that if you win the lottery, you really need a financial advisor and/or a tax specialist.

I mean, it's not like the lottery is making billionaires out of people. Plus, I would think the majority of lottery winners are doing just fine. Sure, I'm sure there are a bunch of meatheads that win and fuck themselves over. Happened to a guy in my hometown, actually.
But I also had a family member become a millionaire through lottery winnings, and they continued to live rather meagerly.

Honestly, I'm not sure what the tax code has to do with this discussion, other than to say that if you do fall into a bunch of money, you should take steps to protect yourself.

I 100% agree that if anyone wins a significant amount of money in the lottery, the first thing they need to do is get a financial adviser.

That said, I'm pretty sure no financial adviser can avert paying 40%+ in taxes on the money. That's just like Thanos. Inevitable.

[TAC]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

[Adami]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

It is what it is. I think people were just noting that becoming a millionaire/billionaire one way means paying more income taxes on the same amount of money than if you did it a different way. Not really my argument, just wanted to make that one point. I'm a dirty socialist though, so I'm not as anti-taxes as many.

[pg1067]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I imagine it varies from lottery to lottery and may also depend on whether you take most/all of the money up front or take payments over time.  However, the lottery commission is going to send a big chunk of change directly to the IRS and another chunk of change to your state's taxing authority (unless you live in a state that has no personal income tax).

A lottery win is going to push you into the top tax bracket, which, on the federal level, is 37% on income in excess of $539,900 or $647,850 (depending on your filing status).  In California, for example, it's 12.3% on income in excess of $625,370 or $1,250,739.  Bottom line, if you're in California, you're netting just over 50% of your winnings, and there ain't no way around it.

The first thing to figure out is how much is being withheld, and it's probably not going to be everything you owe.  Obviously on a lesser magnitude, but I won some money on a game show 20 years ago, and they sent 20% to the feds but nothing to the state.  This is why you get a tax/wealth management attorney and a high-level investment advisor on board ASAP.

You can, of course, give a shload of your net winnings to charity and use that as a tax deduction, but it's still money out of pocket.  It's just going to the charity(ies) instead of the government.  Once you've dealt with the initial tax liability, you can set things up so that the tax liability on earnings on your investments is minimized, but the initial hit can't be avoided.

[TAC]

Yes.

[wolfking]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

Agree, I wouldn't have an issue whatever taxes I'd have to pay out of it truthfully.

[wolfking]

Seen elsewhere...


The lottery is probably the only time a billionaire has to pay a fair share of taxes.

Which is not an indictment on billionaires, but rather an indictment of the lottery system.  That's why real billionaires don't play the lottery.  They have better ways of making money in a manner that allows them to decide what to do with it as opposed to turning over chunks of it to the government.

It's more an indictment on the system in general, in that 'real' billionaires have built up layers and layers of govt provided tax loopholes that allow them to avoid paying what someone who is suddenly in their class doesn't have. It kind of blatantly shows how the tax code is geared towards those who already have excessive amounts of money.

Is this not just the norm though??

[MrBoom_shack-a-lack]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

Agree, I wouldn't have an issue whatever taxes I'd have to pay out of it truthfully.

I think it would feel diffrent depending on if it's millions you earned by having a successful career or just won in a lottery. Not sure which one would be more upsetting honestly.

[TAC]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

Agree, I wouldn't have an issue whatever taxes I'd have to pay out of it truthfully.

I think it would feel diffrent depending on if it's millions you earned by having a successful career or just won in a lottery. Not sure which one would be more upsetting honestly.

Well, obviously, but I'm not sure why anyone is comparing the two.

[wolfking]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

Agree, I wouldn't have an issue whatever taxes I'd have to pay out of it truthfully.

I think it would feel diffrent depending on if it's millions you earned by having a successful career or just won in a lottery. Not sure which one would be more upsetting honestly.

Well, obviously, but I'm not sure why anyone is comparing the two.

Yeah exactly, both completely different scenarios.

[MrBoom_shack-a-lack]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

Agree, I wouldn't have an issue whatever taxes I'd have to pay out of it truthfully.

I think it would feel diffrent depending on if it's millions you earned by having a successful career or just won in a lottery. Not sure which one would be more upsetting honestly.

Well, obviously, but I'm not sure why anyone is comparing the two.

Yeah exactly, both completely different scenarios.

It was only a reflection and a thought. I was thinking that paying taxes on money you won might feel more annoying in a way since well you were "promised" a fixed amount.

[TAC]

Yeah, but there is NO promise. You know going in there's taxes.

[Lonk]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

Agree, I wouldn't have an issue whatever taxes I'd have to pay out of it truthfully.

I think it would feel diffrent depending on if it's millions you earned by having a successful career or just won in a lottery. Not sure which one would be more upsetting honestly.

Well, obviously, but I'm not sure why anyone is comparing the two.

Yeah exactly, both completely different scenarios.

It was only a reflection and a thought. I was thinking that paying taxes on money you won might feel more annoying in a way since well you were "promised" a fixed amount.

Not only that, but if I understand correctly you end up with even less money.

Isn't the advertised Jackpot correct only if you spread out payments over 20 years or something? But if you want all the money at once it's a certain percentage less than the advertised Jackpot?

[TAC]

Right. If you take the annuity (over say, 30 years), you'll get the full jackpot, but if you take the cashout option, then you'll get considerably less.

[ProfessorPeart]

I'd buy Frontiers Records and make wolfking the CEO. His first job will be to fire his favorite songwriter. He'll probably follow that up with Issa.

[wolfking]

I'd buy Frontiers Records and make wolfking the CEO. His first job will be to fire his favorite songwriter. He'll probably follow that up with Issa.

I'll put a bag over her head first, give her one and then kick her out the door.

[TAC]

I'd buy Frontiers Records and make wolfking the CEO. His first job will be to fire his favorite songwriter. He'll probably follow that up with Issa.

I'll put a bag over her head first, give her one and then kick her out the door.

[TAC]

Just one?

[wolfking]

Lucky to get that. 

[MetalJunkie]

I'd buy myself a modest house. I'd buy my mom a modest house. I'd buy myself a reasonable boat, get the best gaming PC on the market, and a black four-door '67 Impala. Oh and a camper because I want to travel the country. Then I'd pay all my bills like 20 years in advance. $50,000 to the phone company, to the electric company, etc. if they even let you do that. If not, I'd put bill money in a separate savings account or give it to some kind of wealth management firm and let them pay my bills.

[KevShmev]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

It is what it is. I think people were just noting that becoming a millionaire/billionaire one way means paying more income taxes on the same amount of money than if you did it a different way. Not really my argument, just wanted to make that one point. I'm a dirty socialist though, so I'm not as anti-taxes as many.

To take this in a slightly different direction: I think it is human nature for everyone to want to do whatever they can to pay as little taxes as possible.  It is easy to rip millionaires who moves to another country to pay less taxes or celebs who talk a big game about taxes and then we find out that they use loopholes to pay less, but I would submit that that is human nature.  Let's face it, anyone who makes millions of dollars isn't taking the "Yes, please take as much money as you want from me in the name of taxes."  Even the "billionaires should pay more taxes" crowd, if they suddenly became billionaires over night, they'd be doing whatever they could to pay the least amount of taxes as possible (despite their insistence otherwise) because, again, no one wants to make a ton of money and then have a lot of it just taken away.  It is just how humans are.  Uncomfortable to think about?  Yeah, probably, but I think it's the way it is. 

[Stadler]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

It is what it is. I think people were just noting that becoming a millionaire/billionaire one way means paying more income taxes on the same amount of money than if you did it a different way. Not really my argument, just wanted to make that one point. I'm a dirty socialist though, so I'm not as anti-taxes as many.

And my point was that it's not as simple as "one way" or "the other way"; they're not mutually exclusive, they're not the same, they're not equivalent.  We WANT people to become millionaires and billionaires in one of those ways, and reward them for doing it.  You can do it, I can do it, it's open to all of us (this goes to something I've written about how some people will NEVER be millionaires, not because of "The Man!" or "The System!" but because they lack the skillset to actually manage and maintain that kind of (well, any kind of) money).  For the record, I'm not "against" taxes (I'm not "for" them either).  They are what they are, a behavior motivation tool (look at the ACA; how did we extort participation in the ACA?  Made it mandatory if you wanted to avoid an additional tax levied by the IRS).

No one should be PLANNING on the lottery as a retirement scheme, and so there is a price for stepping into the circle in that way.

EDIT:  Another aspect to this:  you'll never get this as a statement (because there isn't one person that is really in a position to say this) but while the government will take the chunk of money from a lottery winner, that's not what they want.  They want an annuity as well; they want a consistent, year-over-year income stream ("tax revenue") in order to plan with.  Anyone who works with the government in any consistent way knows that they operate on a very strict fiscal year.  "Use it or lose it".  Congress grants money on an annual basis.  These "blips", these spikes in revenue are better than none, but not optimal. So one of the ways in which the government incentivizes a more consistent revenue stream is to encourage people to spread them out in exchange for taking less. (Not talking about the lottery commissions, as they are neutral on this; they pay the same amount regardless. They either pay you the winner, or they pay the same amount in to an investment firm or insurance company who invests the money and pays out the annuity).

[Stadler]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

It is what it is. I think people were just noting that becoming a millionaire/billionaire one way means paying more income taxes on the same amount of money than if you did it a different way. Not really my argument, just wanted to make that one point. I'm a dirty socialist though, so I'm not as anti-taxes as many.

To take this in a slightly different direction: I think it is human nature for everyone to want to do whatever they can to pay as little taxes as possible.  It is easy to rip millionaires who moves to another country to pay less taxes or celebs who talk a big game about taxes and then we find out that they use loopholes to pay less, but I would submit that that is human nature.  Let's face it, anyone who makes millions of dollars isn't taking the "Yes, please take as much money as you want from me in the name of taxes."  Even the "billionaires should pay more taxes" crowd, if they suddenly became billionaires over night, they'd be doing whatever they could to pay the least amount of taxes as possible (despite their insistence otherwise) because, again, no one wants to make a ton of money and then have a lot of it just taken away.  It is just how humans are.  Uncomfortable to think about?  Yeah, probably, but I think it's the way it is.

I think there's truth there, especially when you add in the concept of "trust".  It shouldn't surprise anyone who is paying attention that some people simply do not trust the government to be responsible in instances like this.

[lonestar]

Seen elsewhere...


The lottery is probably the only time a billionaire has to pay a fair share of taxes.

Which is not an indictment on billionaires, but rather an indictment of the lottery system.  That's why real billionaires don't play the lottery.  They have better ways of making money in a manner that allows them to decide what to do with it as opposed to turning over chunks of it to the government.

It's more an indictment on the system in general, in that 'real' billionaires have built up layers and layers of govt provided tax loopholes that allow them to avoid paying what someone who is suddenly in their class doesn't have. It kind of blatantly shows how the tax code is geared towards those who already have excessive amounts of money.

Is this not just the norm though??

Kind of my initial point, but why listen to my communist self, right?

[Chino]

I've thought a lot about this question a lot, especially within the context of the size of the last jackpot. I wouldn't want the headache. I think the best lottery to win would be like $10M tops, or one of those that pays out like $10K per month for life.

[Stadler]

Baffling; do you guys not want people to have money?  Do we not want people to put money back in the economy?  Do we not want to promote jobs and the transfer of money across industries and across classes?   Why penalize them for doing what we want all along?  It's counter-intuitive and it's based on false assumptions (people and corporations wouldn't be putting money overseas or in tax shelters if everyone was interested in handing over 50% to the government and for what?  To fund Congressional bickering and inaction?).

This is a music site; I should start a thread:  "Ten Best Albums Made While Rock Stars - Even The Commie Ones - Were Avoiding Paying Extortionate Taxes To Their Governments". 

I know my favorite might be "Goodbye Yellow Brick Road", though I know "Exile On Main Street" will get a ton of votes.

[Stadler]

Let's change the subject:  Anonymous or not?   The lottery commission has a vested interest in publicizing the winners; I know for me I do NOT want that information public.  Not only is it annoying but it's quite likely dangerous. 

[Chino]

Let's change the subject:  Anonymous or not?   The lottery commission has a vested interest in publicizing the winners; I know for me I do NOT want that information public.  Not only is it annoying but it's quite likely dangerous.

This is one of the main reasons I wouldn't want that kind of money. I feel like you'd become a target for all kinds of fucked up people.. having to hope your kid's private security to and from school is up to snuff, hoping your compound's walls are tall enough, etc..   

It should be mandated federally that winners can remain anonymous if they choose. Doxxing a winner should earn you jailtime. Jackpots are too big now. It can put a lot of people in danger.

[Lonk]

In Illinois, where the Jackpot was won this time around, the winner can be anonymous. If you have a popular name, you can always do this:

[ProfessorPeart]

Let's change the subject:  Anonymous or not?   The lottery commission has a vested interest in publicizing the winners; I know for me I do NOT want that information public.  Not only is it annoying but it's quite likely dangerous.

Same. I think here in Illinois you have to come forward, but you can remain anonymous if you set up a Trust or something like that. I would go that route. Set up a Trust or whatever and then have a lawyer be the one to accept the check and take the picture. Anything to keep my name out of their mouths and out of the papers.

I even know a lawyer I could call to be my face. He hangs out on a music forum I frequent. 

EDIT: Well, I was wrong. Illinois does allow anonymity now. I swear they didn't in the past. I still might go the Trust route.

[hefdaddy42]

Let's change the subject:  Anonymous or not?   The lottery commission has a vested interest in publicizing the winners; I know for me I do NOT want that information public.  Not only is it annoying but it's quite likely dangerous.

If memory serves, there are only a few states where the owner can remain anonymous.

[KevShmev]

But that's part of the equation, right? If I win the lottery, after taxes I'll get....

I honestly don't have a problem with that.

It is what it is. I think people were just noting that becoming a millionaire/billionaire one way means paying more income taxes on the same amount of money than if you did it a different way. Not really my argument, just wanted to make that one point. I'm a dirty socialist though, so I'm not as anti-taxes as many.

To take this in a slightly different direction: I think it is human nature for everyone to want to do whatever they can to pay as little taxes as possible.  It is easy to rip millionaires who moves to another country to pay less taxes or celebs who talk a big game about taxes and then we find out that they use loopholes to pay less, but I would submit that that is human nature.  Let's face it, anyone who makes millions of dollars isn't taking the "Yes, please take as much money as you want from me in the name of taxes."  Even the "billionaires should pay more taxes" crowd, if they suddenly became billionaires over night, they'd be doing whatever they could to pay the least amount of taxes as possible (despite their insistence otherwise) because, again, no one wants to make a ton of money and then have a lot of it just taken away.  It is just how humans are.  Uncomfortable to think about?  Yeah, probably, but I think it's the way it is.

I think there's truth there, especially when you add in the concept of "trust".  It shouldn't surprise anyone who is paying attention that some people simply do not trust the government to be responsible in instances like this.

I am not even sure it is a matter of trusting the government, but simply a matter of "it's my money."  No one wants to lose a bunch of their money to taxes.  No one. 

[Anguyen92]

^^ I think it also comes down to transparency as well.  If people knew that their money on taxes are actually spent on what they are supposed to be spent on (local road maintenance, emergency calls, etc.), and people have access to the receipts for it, I think people can be more trusting when it comes to taxes.  Without those kinds of receipts, people get more grumbly grumbly when it comes to taxes.