Holy Cow 1.6 Billion Powerball

A local radio station has an office pool going for the next drawing, and they are doing contests to bring listeners in on it too. Meanwhile I picked up a $6 ticket today. I fully expect to be working on Thursday morning.
 
eran0004
Statistically speaking, there is a difference between odds and probability. Your example shows the probability to win, but not the odds.

Statistical odds uses the ratio of positive events to negative events. The odds of rolling any given number with a die is 1:5, one positive event for every five negative events.

The probability is given by dividing each number with the sum of both numbers, in this case 1+5 = 6. The odds of 1:5 thus gives a probability of 1/6 for a positive outcome and 5/6 for a negative outcome. So the probability is 1/6, but the odds are 1:5.

The dice example again:

Number of tickets | Odds | Probability
1 | 1:5 | 1/6
2 | 2:4 | 2/6
3 | 3:3 | 3/6
4 | 4:2 | 4/6
5 | 5:1 | 5/6
6 | 6:0 | 6/6
Click to expand...

You're right, I am thinking of probability, not odds. I have fallen into the trap of using the terms interchangeably.
It'll never happen again!!! (Lie!!!!!)
 
TenEightyOne
That's correct, I suspect @Liquid's image was from somebody using the Euro billion (1,000,000,000,000) rather than the literally-correct US bilion (1,000,000,000).
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No, if they were using a Euro-billion (2^12 v. 2^9) it would still be $4,333.33, not 4.33 million.
Pupik
it makes me wonder if they've ever used a calculator before.
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If they did they certainly need to be retrained on it.
 
At it again today. I picked up the tickets for the Powerball pool at work. 42 people(2 tickets per person). Just like last time, everybody in the store was buying Powerball tickets. No wonder they are breaking sales records. :crazy:
 
Akira Ishi
Just what I was about to mention.

The jackpot may be $1.3 billion, but the actual revenue you may receive is $806 million cash value. The US government never is satisfied when it comes to taxing- and it's the state tax at that. It doesn't go to the federal.

That said, it would be wise not to stay in town if you do win a significant amount of money in the US.
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Depends on the state as well, though.

Texas has no state tax on the lottery, so with the federal tax around 25%, that's it. Annual payments, the Govt. will take est. $375,000,000 of the $1.5B over the course of 30 years, leaving you with $1.125B. If you take the lump sum:
Should a resident of one of those nine states that don’t tax lottery winnings be the sole jackpot winner and opt for the lump sum, he or she will fork over around $368.3 million to Uncle Sam—$42.8 million more than he or she would have owed in 2012 on an $930 million lump. Bottom line: If a lucky resident of one of these states is the sole winner of the $1.5 billion jackpot and takes the lump payment, he’ll get to keep $561.7 million. Not so shabby, although it won’t get you on the Forbes 400 list of the richest Americans, which in 2015 required a minimum net worth (after imputed taxes) of $1.7 billion.
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Government double dipping really is pathetic in these lotteries. To get an casual figure of how much the actual winnings are, I generally subtract 50% for tax, and another 50% from that if it makes sense to cash out. For the $1.5 billion, we figured that number is around $375 million.
 
a6m5
Government double dipping really is pathetic in these lotteries. To get an casual figure of how much the actual winnings are, I generally subtract 50% for tax, and another 50% from that if it makes sense to cash out. For the $1.5 billion, we figured that number is around $375 million.
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Yeah, I don't think that would end up being enough for me... :P
 
I can just imagine what would happen if we had a $150million in australia.
How games would people buy
 
Getting that much money in an instant, is going to make ones life, probably, more difficult than before.
 
It's amazing how badly many of these huge winners end up. They'll take the lump sum, and with long-lost cousins coming out of the woodwork, they give family members a big share (which makes THEM owe taxes,) but a house, cars, do some travelling, and then run one day reach a point where they can't make payroll for the help on that lavish estate, or pay the property tax.

I'm gonna try and avoid that fate by taking it in annuities, and being 58, it's likely I may not even have 30 years!
 
wfooshee
It's amazing how badly many of these huge winners end up. They'll take the lump sum, and with long-lost cousins coming out of the woodwork, they give family members a big share (which makes THEM owe taxes,) but a house, cars, do some travelling, and then run one day reach a point where they can't make payroll for the help on that lavish estate, or pay the property tax.
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A lot of big lottery winners end up bankrupt a few years later, and a big part of the reason why is not realizing all the tax implications until it's too late. For instance, the IRS will withhold 25% of the winnings, but it turns out the actual tax liability is much higher: 39.6%.

Also, winnings you give away are subject to gift tax which can reach 40%. So you pay income tax on what you've won, then pay tax again on the portion you give away. Let us not forget that the recipients are liable for income tax on the gift too.

Then of course we have Illinois which is currently refusing to pay off on any lottery winnings at all in excess of $600.
 
BobK
A lot of big lottery winners end up bankrupt a few years later, and a big part of the reason why is not realizing all the tax implications until it's too late. For instance, the IRS will withhold 25% of the winnings, but it turns out the actual tax liability is much higher: 39.6%.

Also, winnings you give away are subject to gift tax which can reach 40%. So you pay income tax on what you've won, then pay tax again on the portion you give away. Let us not forget that the recipients are liable for income tax on the gift too.

Then of course we have Illinois which is currently refusing to pay off on any lottery winnings at all in excess of $600.
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'Merica. Land of taxation.
 
BobK
A lot of big lottery winners end up bankrupt a few years later, and a big part of the reason why is not realizing all the tax implications until it's too late. For instance, the IRS will withhold 25% of the winnings, but it turns out the actual tax liability is much higher: 39.6%.

Also, winnings you give away are subject to gift tax which can reach 40%. So you pay income tax on what you've won, then pay tax again on the portion you give away. Let us not forget that the recipients are liable for income tax on the gift too.

Then of course we have Illinois which is currently refusing to pay off on any lottery winnings at all in excess of $600.
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Adamgp
Lottery payouts in Illinois over $600 have resumed as of mid December, but yeah our state is a financial mess.
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We sure are a mess. Maybe we should hop the border depending where you live. :lol:
 
Our office pool got up to 17, with 1 ticket per person. In just a few hours I'll be a millionaire. :)

kolio
We sure are a mess. Maybe we should hop the border depending where you live. :lol:
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It's tempting. :lol: I'm about an hour from Wisconsin, and less than 2 hours from Indiana.
 
Adamgp
Our office pool got up to 17, with 1 ticket per person. In just a few hours I'll be a millionaire. :)
Click to expand...
giphy.gif
 
Sorry for double post, but I have a scenario to go over.

You just turned 18 years old today. You purchase the only winning jackpot ticket. You live in NewYork with the highest tax.

Taking the lump sum will give you roughly 615 million dollars. Lets just round that down to 500 million dollars to make sure no corners are being cut whatsoever.

If you live until you are 100 years old, you could live on a little over 6 million dollars a year.

If somebody wants to complain about not having enough money for privacy and hiring a somebody to manage their money - that have something a little wrong.

Maybe I am thinking about this incorrectly - because it seems to good to be true.

EDIT: 615 million may be wrong. So you cut that directly in half, you are looking at about 3 million a year. How bad is that?
 
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Tonight, I picked up three tickets for myself(figured that it'll be over after tonight). Long lines. Do you guys think it'll stay at $1.5 billion?
kolio
Taking the lump sum will give you roughly 615 million dollars. Lets just round that down to 500 million dollars to make sure no corners are being cut whatsoever.
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It's being reported here that Federal tax alone will take roughly 40% of how much ever you are collecting. This is after the lump sum selection penalizing you by taking 50% of the $1.5 billion. It should be $750 million(50% taken away), then Federal Government will take 40% of that, leaving you with roughly $450 million & that's not even taking the NY tax into account.
 
They calculated it on the radio this morning and it would be roughly $375,000,000 in Minnesota after everything is said and done. I think I could live on that for a couple years if I budget right.:lol:
 
a6m5
Tonight, I picked up three tickets for myself(figured that it'll be over after tonight). Long lines. Do you guys think it'll stay at $1.5 billion?

It's being reported here that Federal tax alone will take roughly 40% of how much ever you are collecting. This is after the lump sum selection penalizing you by taking 50% of the $1.5 billion. It should be $750 million(50% taken away), then Federal Government will take 40% of that, leaving you with roughly $450 million & that's not even taking the NY tax into account.
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450 million divided by 82 is 5.4 million a year.

I mean, lets just say you spend a maximum of 2 million a year. That leaves you with about 286 million left when you turn 100 years old.
 
kikie
Getting that much money in an instant, is going to make ones life, probably, more difficult than before.
Click to expand...

No, not really. If it's really that bad, there is nothing stopping you from giving it all away. You are better off in any regard.
 

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