Las Vegas, NV
Monday, August 20, 2007
Powerball at $245 Million, Mega Millions at $171 Million: Pool Your Way to Riches
. . . and Still Win Millions with a Binding Pool or Syndicate Agreement
By Gail Howard
With the Powerball jackpot at $245 million and the Mega Millions jackpot at $171 million, there is plenty of money in either jackpot to spread among large groups of lottery players in pools and syndicates. (In the U.K ., Brits call them lottery syndicates; Americans call them lotto pools.) Lottery jackpots are won increasingly more often by groups of people who pooled their money.
POOL ONLY WITH PEOPLE YOU KNOW
Avoid Internet lottery pools. Google "lottery pool scam," and you'll find 90,000 results: Google "lottery syndicate scam," and you'll find 29,900 results. Internet sharks are out there en masse ready to steal your money.
Pools can consist of two people or more – even 100 when the jackpots are this huge. When a pool with 100 participants wins a $245 million or a $171 million jackpot, each individual in that pool becomes a millionaire.
Lotto pools or lottery syndicates can be organized wherever people meet on a regular basis — at health clubs, golf clubs, tennis clubs, bridge clubs or the neighborhood pub. The possibilities are endless. Some players recruit family members and relatives for their lotto pools to "keep it in the family," in case of a big lottery jackpot win.
Lotto pools are most popular on the job among fellow workers. The shared challenge, through which all could ultimately benefit, seems to bring co-workers closer together in a spirit of friendship. The excitement and expectation of winning creates great camaraderie on the job. When you win, others will share your joy. And when you lose, you can groan and gripe together. So, pooling can be loads of fun. Besides, who knows? You may even win a jackpot!
Before you contribute your share of cash to any pool or syndicate, be sure that an agreement is drawn up (containing everyone's address, telephone number and e-mail address) and signed and dated by all the participants. At the time of purchase, a $1 lottery ticket might seem inconsequential – until it is a winning ticket worth a quarter of a billion dollars! When so much money is at stake, even a best friend might decide the big windfall is more treasured than your friendship. The person who signed the back of the winning ticket is the legal owner. Without a paper trail (a signed and dated agreement), possession is 99 percent of the law.
HOW TO SET UP A LOTTERY POOL OR SYNDICATE
When deciding on the size of your pool, consider the amount of money each member of your pool wants to contribute each week and how often you want to play together. Of course, participating in pools with small amounts of money does not prevent you from buying additional tickets for yourself.
Each member can (and should) participate in the management of the pool. One person can be designated as the banker who collects the money and keeps the accounts. Others can work on selecting the best numbers to play. Still others can wheel the numbers and fill in the bet slips. (Always use wheeling systems when pooling to trap the winning numbers.) Another person can be responsible for buying the tickets. Meetings should be held on a fairly regular basis to get the input of all the members of the group.
WRITTEN AGREEMENTS SHOULD INCLUDE THE FOLLOWING ITEMS
Once you have the members of your pool lined up, decide on a name for your group. Then, draw up a simple agreement describing the pool's bylaws and have each member sign it. The agreement should provide for the periodic payment of a certain amount of money by each member into the pool fund, and it also should provide for methods of distribution of the winnings — or non-distribution if pool winnings are small and are slotted to be reinvested in additional lottery tickets.
The more possibilities that are provided for in the bylaws, the less likely there will be trouble later. Your group should agree on such points as, for example, what if a member of the pool, who has been contributing money every week for several weeks, months or years, suddenly drops out or doesn't contribute due to illness, vacation, lack of ready cash or some other reason? Is that person entitled to a portion of a big win or not?
What happens in the event of death of a pool member? What if death prevents a long-time member from contributing his portion just before the pool wins a jackpot? Are the heirs entitled to a portion of the windfall?
Should each member contribute an equal share? Or can a member buy more than one share and collect a percentage of the win in proportion to the total number of shares he or she owns? What happens if some pool members want the per-share quota raised — or lowered? Is there a limit set on the number of participants in the pool? Can new members be voted in? Should decisions be made by unanimous vote or majority rule? These points — and more — should be considered and voted on when writing the bylaws for members of your pool. And finally, an agreement is not valid if not signed and dated by each participant in the pool.
HOW TO DISTRIBUTE THE WINNINGS FOR INCOME TAX PURPOSES
When a prize of $600 or more is won, most state lotteries will make the payment to one claimant only. Wins of $600.00 or more are reported to the IRS as earned income. Your pool must decide who is responsible for paying the tax on those wins. Whoever claims the big prize should fill in the IRS Form 5754 and send it to the lottery. At the end of the year when the lottery does its taxes, everyone in your pool will get a W2G Form taxed for his share. The best way to distribute a jackpot prize is to have the lottery office cut separate checks to each pool member. If the prize is large, some members may want to opt for the annuity payouts, others may want their share in a lump sum. When your pool wins a jackpot, you should seek professional advice from an accountant and a lawyer before you claim it.
Gail Howard's Web site has a free interactive wheeling system that has already won seven first prize pick-5 jackpots . No sign-in is required. Go to www.smartluck.com
. Use this system for the five white balls. Read the stories (with their letters) about the seven winners who won with this system at www.smartluck.com
Gail Howard's book, "Lotto Winning Wheels for Powerball & Mega Millions," has systems that wheel up to all 56 Mega Millions numbers and all 55 Powerball numbers. See www.smartluck.com
Gail Howard is the author of the comprehensive lottery number selection book "Lottery Master Guide" and lotto wheeling books for pick-5, pick-6 and Powerball/Mega Millions as well as lotto software with scientific strategies and easy-to-use systems to help the lottery player bet smarter.
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Las Vegas, NV