WPBN: One of the most common desires of lottery winners is to collect the majority of their earnings all at once, especially when it comes to large awards. The result of this is that they make a significant error, which, in some instances, causes them to lose almost half of what they have won.
This is what transpired with the fortunate player from Massachusetts who won the “$10,000,000 Bonanza” jackpot but ended up losing $3 million despite winning the huge jackpot.
In August of 2024, the lottery authorities announced that the “$10,000,000 Bonanza,” a scratch ticket game that cost twenty dollars, was the game that resulted in the winning of the ten million dollars.
The scratch ticket was purchased by the winner from a sandwich shop in Raynham called Coletti’s Market. The sandwich shop was even awarded a bonus of fifty thousand dollars for selling the winning scratch ticket.
As reported by Mass Live, the winner made the decision to conceal their identity in order to collect the prize. In order to do so, they established a trust that they named the WSB Family Trust of Wellesley, which is managed by trustee James Goodhue.
According to The US Sun, lottery winners in the state of Massachusetts are not permitted to claim their awards covertly. In spite of this, winners have the ability to create a trust in order to receive their reward without having their names made public. This allows them to sidestep the law.
This is what the person who won $10 million in the Bonanza game did in order to make it possible for the trustee representative to exchange the winning ticket and obtain the check.
“Prizes can be claimed by a trust or other legal entities that fulfill the definition of a legal person,” said Mark William Bracken, Executive Director of the Massachusetts State Lottery, in an interview with Mass Live.
Winning $10 million lottery ticket sold at this sandwich shop in Massachusetts https://t.co/OTAdp46Ig2
— masslivenews (@masslivenews) September 5, 2024
Bracken went on to say that in recent years, winners of significant awards have started using this strategy more frequently. Only the trustee’s identity was disclosed in this instance as well. Although the strategic approach was successful, the winner lost millions of dollars due to another choice.
The winner opted to receive the lump sum award, which required the trustee to pay more than $3 million in taxes when Goodhue picked it up. The winner would have avoided paying taxes if they had opted to receive the money in annuity payments.
Lottery attorney Andrew Stoltmann previously told that approximately 90% of all lottery winners accept the lump sum payout. This “big mistake” costs winners millions in taxes, according to the expert.
According to Smart Asset, the winner must pay the IRS more than 25% of the award up front before they can get any winnings. Additionally, state and local taxes can lower the amount by an extra 13%, depending on the area. When it comes time to file taxes, the winner can ultimately still owe more.
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As a result, the trustee ultimately received just $6.5 million from the lottery, which would have also been subject to federal and state taxes.
Consequently, the Massachusetts winner received just $6.5 million of the $10 million before taxes. Goodhue was responsible for depositing the check into the bank account linked to the winner’s trust.
The trustee revealed that the winner had already planned to invest the remaining funds and buy a new home despite the immediate loss.
