Lottery Tickets as Holiday Gifts: Unsurprisingly, lottery tickets and scratch-offs are favored as stocking stuffers. Who wouldn’t want a substantial windfall to begin the new year? However, although we all enjoy fantasizing about ourselves or a loved one obtaining the grand prize, lottery play is not exactly glamorous in reality. This holiday season, before purchasing lottery tickets for yourself or someone else, there are five things you should be aware of.
1. You’re probably throwing your money away
You undoubtedly already know this, but your chances of winning the lottery are not particularly high. The odds for the Powerball are 1 in 292,201,338; the odds for the Mega Millions are even worse. Although scratch-off tickets offer reduced prizes and improved odds, the payouts remain relatively modest.
However, that does not mean you cannot participate in the game, provided you are aware of the potential hazards, and maintain reasonable expectations. Additionally, only invest funds that you are willing to lose.
2. Wins aren’t as valuable as you’d expect
Although one or a family member may secure the jackpot, the amount won will be considerably less than the grand reward. Large lotteries such as Mega Millions and Powerball do not award the complete prize amount when the lump sum option is selected, a practice that is commonly observed. Furthermore, there is a concept known as taxes.
You will be subject to the highest tax bracket and be required to return 37% of your proceeds to the federal government if you win millions. Additionally, your state may take a portion. Even modest winnings may be sufficient to elevate an individual to a higher tax bracket, resulting in increased revenue for the government and decreased personal income.
3. The prize doesn’t belong to the ticket purchaser
In legalese, a lottery ticket is a bearer instrument, which means it represents “property that is owned by the person who possesses it.” Therefore, should you graciously bestow a ticket upon a family member or acquaintance and they transpire to be the winners, it shall be theirs. The fact that you purchased it with your hard-earned currency is irrelevant.
Should they retain the substantial winnings, they are not obligated to share them with you. Moreover, should that pose a difficulty for you, you may wish to retain the ticket in your possession. Instead, buy your friend something else.
4. It’s not that easy for winners to share
Therefore, you and your friend or relative have agreed to divide the winnings if either of you does. That addresses the aforementioned issue, doesn’t it? Not precisely. Individuals are prohibited from donating in excess of $17,000 per person in 2023 and $18,000 per person in 2024 due to the gift tax. If you give more than that, the IRS will require a report. Furthermore, it will be deducted from your lifetime gift limit of $13.61 million in 2024, up from $12.92 million in 2023. Expect to pay taxes on the gift if the lifetime gift limit is exceeded.
In the past, individuals have divided lottery winnings successfully; however, you will need to retain legal counsel to accomplish this. As described above, if one individual claims the ticket on their own, that money legally becomes theirs.
5. There are better ways to give cash for the holidays
In most cases, a lottery ticket is a meaningless piece of paper. If you prefer to give a certain something to your family or friends, consider giving them cash or a gift card. Alternatively, if you wish to leave an enduring impact, you could contribute to their college savings account, open a brokerage account, or even give them stock shares as a gift. Engaging in these activities is a considerably more secure approach to accumulating wealth and establishing solid personal finances compared to participating in the lottery.
Alert: highest cash back card we’ve seen now has 0% intro APR until 2025
Not only is this credit card acceptable, but it is so outstanding that even our experts personally utilize it. This card offers a 0% introductory APR for 15 months, a 5% cash-back rate, and no annual fee whatsoever.
Nagaland State Lottery Sambad Result For 18 December 2023 ANNOUNCED: Check Result here
