Already on ArticleSlash?

Forgot your password?Sign Up

# Present Value of Lottery Payments

Visitors: 402
 Currently 0/512345

Every year thousands of lottery winners convert their future lottery payments into present money. The value of your future lottery payments will considerably depreciate over the traditional payoff schedule of 20-25 years. Often, recipients of lottery payments receive less than the amount offered by state lotteries. The calculation of present value of lottery payments is done by many personal representative guidance services.

The concept of present value is important in the field of corporate finance, banking, and insurance. Present value is the value today of an amount of money in to be received in future. Mathematically, it is equal to the sum of payments at a given a particular interest rate. It is essential to know the present value of lottery payments for selling or buying them.

There are certain court rules on how to determine the worth of future lottery payments. The value of future lottery payment is calculated under section 7520 tables. Several tax courts have emphasized the need for valuation of future lottery payments using annuity tables.

The following example will illustrate what actually a present value of lottery payment is. A state government in the U. S. advertises that one of its lottery prizes is \$1 million (the face value. ) But that advertised amount is not the actual value of the prize. In its place, the government offers to pay \$50,000 a year for twenty years, on a discount rate of 10%. After receiving the first payment, if you did calculations for each of the other 20 years of payments, you would see that the present value of your entire 20-year stream of lottery payments is only about \$468,246. Present value of lottery payments are based on the idea of compound interest in reverse.

Sell Lottery Payments provides detailed information on Buy Lottery Payments, Present Value of Lottery Payments, Sell Content Winnings, Sell Future Payments and more. Sell Lottery Payments is affiliated with California Lotteries .

(323)
Tags:
present value of lottery payments

 Rate this Article: Currently 0.00/512345

Have You Ever Thought of What You Would Do If You Won the Lottery?
Rated 4 / 5
based on 5 votes
ArticleSlash

Related Articles:

### How to Accept Payments For Your Ecommerce Store and the Methods of Payments ..

by: Fabian Tan (June 04, 2008)
(Internet and Businesses Online/Ecommerce)

### Money for Nothing Much More than About Lottery Tell-All

by: Glenda Bixler (March 26, 2008)
(Book Reviews)

### So You Want To Win the Lottery

by: Michael Losier (September 01, 2005)
(Self Improvement/Attraction)

### Lottery Dreams

by: Catherine Kasper (February 17, 2007)
(Self Improvement)

### I Won the Lottery

by: Delia Galley (September 23, 2005)
(Finance/Personal Finance)

### The Weight Loss Lottery

by: Robert Van Gardner (February 14, 2008)
(Health and Fitness/Weight Loss)

### Lottery Ticket Mentality

by: Ryan S Dunn (April 20, 2008)
(Home Based Business)

### Lottery Winners Are Broke!

by: Michael A. Verdicchio (November 20, 2006)
(Self Improvement)

### Using the Lottery As a Debt Solution

by: Ward Willison (January 12, 2007)
(Finance)

### Have You Ever Thought of What You Would Do If You Won the Lottery?

by: Gary Madden (June 25, 2008)
(News/Religion)

← Translate