First of all, good for her.
Second, I think it is ABSURD that the prize of $66M is reduced, due to government's greed, to $27M.
Third, I think government-sponsored lotteries over all are a generally bad idea, keeping people from working hard and saving. I would make an exception, perhaps, for occasional events for special purposes.
May she spend it wisely. Hope she doesn’t blow it all and end up back where she started.
well....lump sum is half before taxes
that’s 33.5 Million...and then Uncle sam takes his bite. and then maybe state taxes.
still....that’s a pretty good payday. God bless her.
how long before baby-daddy comes back into the picture?
Good for her indeed. But now that she’s one of the greedy rich, she has to pay her fair share of taxes to help those in need.
60% tax rate??!!?
Yikes!
$66M is the annuity value, designed to be paid out over a term of typically 20-25 years. Taking the "lump sum" payout means you take a smaller amount, essentially the same as the principal that would buy the annuity. Most states do not levy state income tax on lottery winnings (not sure about Michigan), although federal taxes apply. Assuming a 28% federal tax rate, the actual lump sum payment would be about $39M, with $12M going to federal income tax.
Hopefully this woman will play it smart with her winnings. My advice: take the majority of that money and invest it in low-risk, income-generating investments. To wit: she can spend $2M on whatever she wants, invest the other $25M, and even at an anemic 2.0% APY, she'll pull in $500k in gross income a year, for life.
I guess Im the only one who wonders why a single mom with 2 jobs is blowing money on the lottery?
You don’t get the full 66 if you take the lump sum, in effect, you get what would have to be banked in order to provide 66 million over the course of 20 years or whatever the payout term is.
Will she turn in her EBT card too?
Lotteries are someone dishonest in their advertisements.
Say you win a lottery with an advertised payout of $1,000,000 a year for 20 years. The Lottery agency will say it is a $20,000,000 payout which is true. But a $1,000,000 a year for 20 years is not worth a lump sum payment of $20,000,000. It is a simple time value of money problem.
How much are you willing to pay today for the right to receive $1,000,000 twenty years (19, 18, etc) from now.
She will have it stolen from her by many means.
The safety and security of your family is your first priority.
Take it as quietly as you can.
For every story like this there are millions who spend money on lottery tickets instead of food for their kids.
:: and plans to quit her jobs ::
Not always the best of decisions when one is the beneficiary of the lottery.
It’s called present value. There is even a function in excel to calculate it.
Just to settle any arguments on which states winners can stay anonymous, here it is from straight from the horses’ mouth,
“CAN I REMAIN ANONYMOUS WHEN I HIT THE JACKPOT?
All but five states (DE, KS, MD, ND, OH) have laws that require the lottery to release the name and city of residence to anyone who asks. Some states are considering anonymous claims.”
http://www.powerball.com/pb_contact.asp
Mega Millions has no such list but a good chart on which states tax winners and how much;
http://www.usamega.com/mega-millions-faq.htm
I think she will be broke soon
From the article:
She works two jobs but her boyfriend has been unemployed for a year.
Shes dreaming of vacations and sports cars.
She has spent $10,000 on lottery tickets
"What you mean she only has two jobs?"
That was the cash option, after taxes IIUC. The $66M would be paid out as an annuity over a long time period, 20-25 years probably. Each year's payout would be taxed in that case. That would be $2.64 million a year over 25 years. If she's smart the first thing she'll do is buy several well located and well managed apartment buildings; even if she blows all the rest she'll always have a place to move into and an income.