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Winning the Lottery Advice

by Kevin Walter on Monday, August 27, 2007

Won the Mega Millions!  What to do after winning the lottery?

There are some critical steps that you need to take as soon as you win the lottery.  The first and most important step - shut up!  Don't tell a soul.  Don't tell your spouse, your partner, your kids, your dog.  OK, you can tell your dog. As hard as it is to keep your mouth shut, this is actually a very important step.  Anonymity is the name of the game when it comes to successfully dealing with your lottery winnings.  As soon as someone knows you have won the lottery, the onslaught of hucksters, long lost relatives and any number of snake oil salesmen will appear.  So, it's critical that you keep your trap shut until you are prepared to divulge your secret.

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Step two, consultant an attorney.  Not just any attorney, but most typically an attorney that specializes in high net worth individuals typically focusing on estate planning and perhaps lottery winning directly.  These specialties exist and heck, you can afford an attorney, so use one!  Your new attorney, if they are worth their salt, should immediately direct you to set up a blind trust.  In many states, it is legal for blind trusts to claim lottery winnings. This keeps your identity out of the public record and the aforementioned schlocksters away from your door.  However, even though it's a blind trust, be aware that many states require that the trust divulge it's beneficiaries internally to the state.  This is done to match the names of beneficiaries against the child support roles.  After all, any new multi-millionaire will want to do right by their children!

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Winning the California Lottery
I have some question about winning the California Lottery.
1. I keep reading that if you win the California lottery you should claim the winning with a blind trust.  I keep looking for a sample of a blind trust but can’t find one, dose anyone know where you can find one for winning the lottery?
2. Could you claim the lottery as an LLC or a corporation?
3. I hear that one guy who won set up a non profit foundation. If you set up this non profit foundation before you claim the lottery winnings. Could the foundation be a partner in the winnings. If the foundation could be a partner in the winnings and the person who won gives 20% to the foundation, would the foundation have to pay taxes on that money?
4. Now lets say that you won the lottery for 100 million and you give 20 million to this non profit foundation and the foundation did not have to pay taxes on that money it receives would the person who won have to pay taxes on 80 million or 100 million?
When I win the California Lottery and I want to stay anonymous this is what I would like to do.  Form a corporation and a non profit foundation, put them both into an LLC and have the LLC do a blind trust to claim the winnings.  This way you would have 3 layers of anonymity.  Tell me what you think.  

Thanks
Anonymous


214 out of 378 people found this comment informative.
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Lottery
What are the smart ways to claim powerball lottery jackpot winnings that would allow one to preserve anonymity, minimize taxes and maximize protection?
227 out of 397 people found this comment informative.
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Would someone explain -- why do some lottery winners elect a trust fund instead of going directly to the lottery headquarters and processing the paperwork?
199 out of 360 people found this comment informative.
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If I win the Lottery, Do I have to make my name public?
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How To Prevent Lawyer from taking your winnings?
If you set up a blind trust and get a lawyer to claim it on behalf of your blind trust how can you safeguard against the lawyer from claiming the winnings for himself? (Assuming I have already made a copy of the front and back of the ticket). I greatly appreciate any helpful comments. Thank you.
28 out of 49 people found this comment informative.
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pCNlIzIIFPa
Stands back from the keyboard in amazement! Tahkns!
7 out of 12 people found this comment informative.
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