What to do with your winning Powerball ticket
Many are crossing fingers or praying to hit the $500 million Powerball jackpot. It’s is the sixth largest jackpot we've seen in the U.S.
LOUISVILLE, Ky. (WDRB) -- Many are crossing fingers or praying to hit the $500 million Powerball jackpot.
It’s is the sixth largest jackpot we've seen in the U.S. The chance of winning is 1 in 292,000,000 -- pretty slim odds. But if you did win, legal advisers tell WDRB not planning ahead could cost you.
We all dream about what we'd do if we won the half billion dollar jackpot – pay bills, buy a home, a new car, even donate. But Attorney Doug Bozell with Frost, Brown, Todd said the smartest thing you can do is hit the brakes before you claim that cash.
"If you suddenly come into this large amount of money you're suddenly going to have a lot of friends."
One reason Bozell warns lottery winners to plan ahead. Instead of claiming the winnings yourself he recommends getting an agent to act on your behalf.
"Having an agent can slow down the roll of all those people coming at you with how you should spend the money," Bozell explained.
Next Bozell said you should get a tax attorney to discuss your options, whether to claim your winnings in one lump sum or paid out over time.
"If you win this money and keep it you can anticipate that about 40 percent of it is going to Uncle Sam at the time of your death."
Bozell added giving it away could cost you too. The most money you can gift someone is $5,450,000 anything above that is taxed at 40 percent.
And last but not least, find a financial adviser to help you manage your windfall.
“You might think about placing it into a trust," Bozell explained. "How's that money going to distributed after you're gone? Is it going to continue in trust for the benefit of your children?”
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