Posted on 04/02/2012 8:30:50 AM PDT by rawhide
Employees at a McDonald’s in Maryland are outraged at a co-worker who claims she won $105million in Mega Millions which she is not planning on sharing - despite the fact they had pooled their money for tickets.
Workers at the fast food outlet bought a number of tickets together for the biggest lottery in world history but Wilson claims she separately bought one of the three tickets nationwide that will split a record $656 million payout.
'We had a group plan, but I went and played by myself. [The ‘winning’ ticket] wasn’t on the group plan,' Wilson told The New York Post.
The group’s tickets —along with a list of those who contributed to the pool — were left in an office safe at the fast food outlet..
Then, late Friday, before the night’s drawing, the owner of the McDonald’s, gave Wilson $5 to buy more tickets for the pool on her way home from work, and she went back to the 7-Eleven and bought them.
Wilson took those tickets home with her.
According to the Post, when she found out she had the winning ticket, she called coworkers and told them she - rather than they - had won.
'I won! I won!' she told a colleague.
'She said, "Turn on the news". She said she had won.
A man identifying himself as (Allen), the boyfriend of a McDonald’s manager named Layla, then went to Wilson's home to question her about the winning ticket. Though she first refused to come out, they banged on her door for 20 minutes until she finally relented.
'These people are going to kill you. It’s not worth your life!' Allen said he told her.
'All right! All right! I’ll share, but I can’t find the ticket right now,' she said, according to Allen.
(Excerpt) Read more at dailymail.co.uk ...
the IRR (interest) on the 20 x $10.65 m payments is 9.15%.
So the lump sum would have to earn 9.15% after tax to equal the value of the payments.
I am assuming 20 equal pmts received at the beginning of the year. The 9% seems outrageously high ... meaning the lump sum given is much too low. Either:
a. the imformation is wrong
b. or taking the lump sum is dumb.
N=20, beginning of year ... so final pmt is 19 years from now.
Pmt= -10.65 million
NPV = 105 million
Interest Rate = 9.15%
I agree, that in another time, taking the lump sum would’t make sense. Especially, with the annuity, you could make mistakes for the first couple of years without worrying because you’d have another cheque coming.
But since I have absolutely no faith in most states being financially solvent, with their pension payouts or infrastructure, I’d rather have the bird in the hand than a promise in the bush.
I don’t want to line up as a creditor at any point in time.
I think I could live almost as well on $105 million (subtract taxes) than I could on $213 million (minus taxes).
the current federal rate on $105m is 35%
most states 5 or 6% ... combined 40% or so.
And the feds have a nice claim of 40% estate tax on what is left. And ya cannot give it away .... unless you move some to a charitable trust ... no longer your asset then.
The smart move for an elderly person is try to have your grandchildren cash it in ... but I do think minors can be owners. This might be challenged saying that you are the owner and you GIFTED it to your grandchildren .... not sure what the law says.
That’s why I was thinking, if I ever won the lottery, to have it paid out to a corporation, so I would only pay the corporate level of taxation.
I’d be the sole shareholder, since I don’t have family. But if I did have family, they’d have enough shares so that their income would be tax-free.
I know a guy who does this. He’s a plumber and his company is incorporated. His family are shareholders and they have enough shares so that each kid and wife get the maximum amount of income, but remain tax free. Consequently, instead of being taxed at an income of $100,000, he’s only taxed at $60,000.
I think that I’d be dumb enough to settle for $105 million up front. At that point, I don’t think I’d be too concerned about the difference. :=)
if what you say is true, then municipal bonds would have to pay 12% to be sold on the secondary markets ... and their yield is less than corporates ... which means munis are seen as safer than corporate bonds and stocks.
the solution is to short the muni market or buy puts on something like a muni ETF.
The loss you are concerned about is not seen as real by the markets and if you think it is you can buy ‘insurance’ real cheap cuz the markets are underpricing the ‘insurance’.
Never give your money to a friend to go bet at the casino!!!
Your bet will always lose and the friends will win!!!
well Bob. It sounds like you would want the money invested at a very low rate. What would you do with it once you got it? You’d hafta loan it out somewhere.
in the US, it is usually better to file jointly, so it don’t matter if you give income to your wife or yourself. And kids get a break on the first 1900 of income, so he must have about 20 kids.
on the annuity question, you could sell the 20 year annuity off and get a larger lump sum than 105$ million.
Way back when I was a working stiff, I ran a lottery pool of 20 people at $1 per week each, sometimes I bought a few tickets on my own.
Each week, I'd run off 20 copies of the "pool" tickets and give one to each participant before the drawing, thereby preventing anything like this from happening.
Believe it or not, I hadn't really given the matter a great deal of thought. :=) That big a sum of money would open up all sorts of possibilities, most of which are beyond my wildest imagination. (I'm sure I'd figure something out, though, if the need arose.)
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