A lot of misconceptions about the lottery. One of the biggest ones is that if you opt for the 30 annual annuity payments and die before they are paid the unpaid monies go back to the state. Not true. The annuity is an asset just like any other. It is a part of your estate and the remaining dollars can be paid all at once from the lottery commission or the annuity can continue in your benefactors name.
Another big one is that you would receive the amount that is advertised. If the lottery hits 1.3 billion as they predict, the cash sum would be roughly 850 million, and half of that amount would go to taxes, unless your state has no income tax.
And no you can't move and then ask for your prize; it is calculated within the laws of where the ticket was sold, unless the purchaser lived out of state when he bought the ticket. Example: If you live in Florida and bought the ticket in Oklahoma on a visit then you would not pay state tax. However, if reversed then Oklahoma would view the winnings as part of your income and even though Florida didn't hold out tax, Oklahoma would collect its part as they do on all of our earnings.
If you choose the annuity, the 850 million is invested in an annuity which after 30 years of interest will have paid out a total of 1.3 billion, hence the advertised number.
If you want to take a lump sum and wonder what your total take would be after taxes on any large jackpot like the one coming up, here is an easy way for Oklahomans to determine that number.
Take the advertised amount and multiply by .333 and that is (with the standard tax rate for that amount) is what you will pocket. In other words, you actually only (ha) pocket 33.3% of the advertised amount. 1.3 billion would put 432,900,000.00 in your pocket.
So 43,333,333.00 each year before taxes for 30 years (and yes if you die early your heirs keep it)
or 432,900,000.00 right now.
An absolute nightmare to be in......right?
