Posted on 07/24/2020 6:31:28 AM PDT by lowbridge
A western Wisconsin man will share his millions in lottery winnings with a longtime friend because of a promise they made to each other nearly three decades ago.
Friends Tom Cook and Joseph Feeney shook hands in 1992 and promised that if either of them ever won the Powerball jackpot, they would split the money.
That promise came to fruition last month when Cook bought the winning ticket for a $22m jackpot at Synergy Coop in Menomonie.
When Cook called to give his friend the good news, Feeney couldn’t quite believe it.
“He called me, and I said, ‘are you jerking my bobber?”’ said Feeney, an avid fisherman.
Cook retired after hitting the jackpot while Feeney was already retired. Neither has any extravagant plans for the winnings but each is looking forward to enjoying more family time.
(Excerpt) Read more at theguardian.com ...
Pretty hard to prove a handshake in 1992.
Not really. Did anyone see it done. Was it ever talked about in social gathering. Did they mention it to others. Did either write anything about it in a card, letter , email etc.
The last time there was one of those huge lotteries there was a long article looking at the results of previous winners.
The one’s that spent big were soon divorced, destitute or dead. I recall one couple divorced and they both ended up buying huge homes and all the toys.
They both were found dead in their respective homes. One of them wasn’t noticed missing by anyone for months. Have all that money but NOBODY cares about you.
The success stories were the older couples that bought a reliable Buick and new carpets for the house. Donate millions to the local charity they help out at, and set aside education trust funds for their kids or grandkids.
I remember that show fondly!!!!!
I know all about verbal contracts. The problem with verbal contracts is there is only oral evidence of the agreement. If the parties disagree about the terms, it's difficult to enforce an oral contract. In this case, his friend got half the winnings. Why would he sue? It's the IRS that would possibly question the arrangement and argue that there was no contract if it determined it was a tax dodge. Happens all the time.
IRS will most likely make him pay the entire tax because he received the money, a taxable event. He can then split it with his buddy, with whom he has a binding agreement.
Of course, The question is whether the payment to his friend is a gift or payment of a contractual obligation. There are different tax implications associated with each. If it’s deemed a contractual obligation, he would not only be entitled to an income tax deduction for the amount of the payment, but the payment would not reduce his unified credit for estate and gift tax purposes. Depending on the circumstances, the IRS might not like that outcome and could challenge his assertion that he was subject to a contractual obligation.
They could appeal the tax court decision or accept the decision and owe the tax. If they weren't able to pay the tax due, the IRS could obtain a lien on their assets and garnish their wages. There would be no criminal charges because there was no crime. Criminal charges are brought when people lie to the IRS, hide income or manufacture deductions.
Thanks. You obviously know this tax stuff better than I do!
it’s a verbal contract
I have a few good friends at work who were really broke.
So when we had everyone chip in for the big lottery (like 5 or ten or 20 dollars each) I put in a buck for each of them.
I was desperately wanting to see us win and see the look on their faces when I told them I put in a dollar for them. To think of the lives that would have changed.
That is a generous and kind thing to do. You will be blessed for this kind of service.
Well, I guess your so stating despite your lack of any credentials or experience whatsoever in contract ;aw settles the matter.
;aw = law.
Couldn’t they just avoid all the mess by setting up a two member LLC to collect the winnings. Each own 50% with the entity not being taxed and each taxed on their own share?
Seems rather the simplest approach...
What am I missing?
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