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Let's say you just won the lottery (in the US). What is the smartest way to give money to your friends? (lemmy.world)

submitted 3 months ago by [email protected] to c/[email protected]

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I don't know why stuff like this keeps me up at night but let's pretend you just won some obscene amount and there's a lot of people you'd like to set up for life. Let's say after taxes you have $300m in your account

You can give someone up to 18k a year without incurring a gift tax and while that'd definitely be a nice bump to their income, you still have way more money than you know what to do with. So what's the smartest way to hook them up?

A couple of options I've considered are:

Give them a lump sum of $X million. They eat the taxes the first year and handle the savings themselves.
Create a company and hire them to "work" one hour a month for a big salary. If you put $25m in an account, the interest covers the salary. They get a steady bonus income with the added bonus of getting the best insurance available. Is that legal?
Set up a "shared" checking account they can use to pay for...whatever. But would these expenses count towards the gift tax? I do not know.
Buy houses and let them live there rent-free. I don't really like this one because I don't want to be a lord to my friends and family.

For the record, I did not win the lottery. I don't even play it. I'm just working out the details in a fantasy world for some reason

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[–] [email protected] 4 points 3 months ago

Did a little research. You want to be in one of the 9 states that doesn't tax in lottery winnings. Fed will take 24% immediately and you'll pay the remaining 13% when you file taxes. The $18k gift tax limit is to and from per person. If the giver and recipient are both married, each giver can give each recipient $18k, so $72k per year from one married couple to another. Still trying to figure out the trust situation.