Imagine being the winner of last nights Powerball
And Facing a $1B dollar tax bill!!
$1B dollar tax bill for Powerballwinner?
Imagine being the winner of last nights Powerball
And Facing a $1B dollar tax bill!!
I think I would be just alright with that.
I could live off the other 700+ million pretty comfortably
California has hit for 4.8 billion in the past year of Powerball
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It isn’t a $1B tax. The 774.1m is the cash option. The 1.7 is the annuity. You would be able to make the 1 billion loss up with investing it. You also have to pay taxes on the 774 too.
That’s just the “take it all now tax.” The actual taxes make it more than that. They’ll have the 24% state income tax and up to 37% federal. Still plenty to live on though
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I don’t think the winner will have a $1 billion tax bill. The cash option is just $780 million anyway. The tax would be calculated off of that total. US highest bracket is 37% and states highest is CA at 13.3% so the absolute highest tax you could pay on the cash option would be $390 million. A smart winner however would take a few million to set themselves up and plow the rest into a charitable trust that pays them a handsome sim to do charitable work for the rest of their lives. No taxes on that and current interest rates would mean you could live a really nice life, do a lot of good, and that trust will take care of generations of their family and do good for generations as well.
I'm very familiar with the Frazier Park area, it's a very small community on the Grapevine route of Interstate 5. I suppose a Frazier Park resident could have won it but chances are high that a traveler bought the winning ticket while buying gas heading north or south.
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I think the taxes would only be on the $700M. The drop from 1.7B down to the lump is a the difference in the present value of the future annuity.
That’s what I was thinking too. Lots of truckers and travelers going through there daily that pit stop there.
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Yes and the spread between the two is really high right now because treasury yields are so high right now. The up front deposit has a much higher future value so they can advertise a lot bigger number right now.
I wonder if the person who won $1.5 billion from a shop on skid row has claimed their jackpot yet, think that was back in early summer
Having that much money to have that much of a tax bill would be a fun problem lol
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The Charitable angle is pretty slick
I knew there was always an angle however I never knew what it was.
I guess that's why you're the @DataDude !
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There are people that make a lot of money saving people a lot of money.
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Could you imagine just even getting $1 million? Pay off house, cars, and make sure kids college is good to go? That would make life so much easier and give a lot financial flexibility.
I'd really like to see how any of that feels....think I could deal with it.
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Ha I knew I forgot to buy something yesterday. That would have been me:
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Probably couldn't even buy themselves that gold plated Honma set of clubs at $70,000.Poor soul having to live on only 700 million.
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there are more people who don't make a whole lot of money saving people a whole lot of money (raises hand)
As stated- not a "tax", but there is some involved in there on the 700 mil, so THAT would be less. Probably 'clear' about 500 after taxes... maybe less.
This one always gets me
the mandatory withholding of 24% "eats into" the full 37% owed. the 37% isn't owed on all of the winnings because income taxes are generally progressive, but at that amount of money it's essentially 37% on the whole thing. so the extra tax bill for federal would be 13% (37% less the 24% withheld up front). the smart thing to do is plow the tax bill into a short-term cd (probably tax-exempt) so the money is earning a little something and protected until it's due next april.
with that much money, your bigger concern is shielding the growth from the estate tax, and protecting yourself from yourself. i love the idea of annuity trusts (cruts, slats, and others) that freeze your net worth but still provide income streams, creditor protection, etc. it would be a lot of fun to have this money and come up with cool ways to preserve the wealth while helping family, charities, and living the good life.