Tax Crew: Question about winning lottery, and giving the money away.

[DVK916]

The government then taxes this, and lets say I take him around 70 million after tax. Now lets say in the second year I have 68 million left, and decided to give the rest to my children ( hypothetical, I have no kids). Is their anyway to prevent the government from taxing the winnings again on my children?

Or what if I win 70 million after tax and want to give half to my children, how can I stop the government from collecting taxes on it again and slashing the winnings even further?

This is a hypothetical question that I have been wondering.

 

[FoBoT]

you would talk to a good estate attorney, if you had that much money, and they'd tell you your options

 

[MichaelD]

If you won $100M, you would probably still be living in Mom and Dad's basement...b/c they let you have "your cool friends" over on Friday nights, but only if you mowed the lawn.

Don't worry about it...get some sleep.

 

[DVK916]

I have been told an irrevokable trust could do the trick, but that is only for when I die. Is this true?

 

[Geocentricity]

A certain amount per year can be written as tax-free gift.

Even if you die, there is estate taxes and sh*t.

You COULD establish trust funds so the money will always be there and only get taxed on the interest.

 

[DVK916]

Originally posted by: Geocentricity
A certain amount per year can be written as tax-free gift.

Even if you die, there is estate taxes and sh*t.

You COULD establish trust funds so the money will always be there and only get taxed on the interest.

IF I had $70 million, and I wanted to give $35 million in 1 year period how could it be done. Is it possible to do it tax free.

Again I don't have $70 million, just was wondering about tax laws and lottery.

 

[Shadowknight]

You can give $12,000 per person (I think) every year before you have to pay tax. So if you give $12,001 to a person, you pay tax on that extra dollar. You also have a unified gift and estate tax you can use. I don't know the number offhand, but it's around 1.5 million I think, but check the IRS website. So if you died and people inherit your possessions, that credit is also used. So if you gave away $1,000,000 (not including yearly exclusion per person) and you died and left $1,000,000 (assuming the credit is 1.5 million), then you have a total of 1.5 million of the credit used and 500,000 your estate pays tax on. The credit's been going up every year, and I think one year there will be no tax on estate/gift, but then it'll come back into existence the next year.

 

[lytalbayre]

What about living trusts?? I don't know much about them, but I know they are exempt from a lot of stuff....

 

[ranmaniac]

You could setup a non-profit organization with the money, like the Gates Foundation, but this will require a board of directors, tax-audits etc.

 

[Feldenak]

There's a way to do it but you have to become...

<dramatic music>
a theist!!!!

 

[QED]

Move to Trinidad with your millions, set up a company there and hire your kids as "consultants".

Since the money is offshore, it should be off-limits to the feds...