HOW TO SELL LOTTERY PAYMENTS
Lottery prize winners receiving payments over time may be able to convert all or part of their future payments into an immediate lump sum cash payment.
Though some states prohibit assignment of future lottery payments, certain conditions can lift this prohibition. Such conditions include bankruptcy, the splitting of assets required by a divorce, and the need to fund a major medical procedure.
Need Lump Sum Cash Now?
If you need a lump sum now but want to keep receiving part of your annual payments, you can choose what is called the “split payment option”. Under this option, you literally split your future lottery payments into two parts. One part is given to you as the lump sum you need now while the other part is given to you on your periodic/annual payment day.
The Process When you Sell Lottery Winnings
When you sell lottery payments it takes about 2 to 3 months to complete. The process cannot be any shorter than that because you have to get a court order instructing your state lottery commission how the original payment arrangement should be amended.
Since the tax treatment of a lump sum gained through the sale of lottery payments varies from case to case, it is best to consult with a tax adviser.
Furthermore, since you need court approval for the transaction, also seek the assistance of an attorney.
There are many companies out there who want your lottery winnings. You don’t want to accept the first offer that comes along when there’s a company out there that’s willing to pay you top dollar. Compare the offers of many different companies. Look them up online and check with the Better Business Bureau (BBB) to see if they have a complaint-free record. Exercise prudence because a bad decision may leave you with a raw deal that you’ll regret for a long time.
Information You Should Have Handy When You Want To Sell Your Lottery Winning
Lottery payment buyers normally require the following information to provide you a quote:
• The state in which the lottery winning was won
• The exact amount that was won
• The gross payment per year
• The actual value of the check you receive each year (after taxes)
• The exact annual lottery payment date (month, day, and year)
• The total number of payments for the lottery winning.
Sometimes, buyers can purchase from winners who want to sell future payments. It depends on the specific language of the prize agreement. Some prize agreements clearly forbid assignment to another party. Review the agreement with a lawyer to see if future lottery payments can be sold.
