What Happens When an Office Pool Wins the Lottery?
Office pools for lottery tickets are a bit of a ritual in some businesses. Colleagues of all types may buy tickets together on a weekly basis. Others only wait until the pot is an exorbitant amount. Of course, everyone dreams of hitting it big. However, most don’t have a game plan for the unexpected win. What exactly happens?
There are different types of lottery pools. There are the groups that have actual rules written out and may even require participants to sign a contract. In those cases, one person generally organizes the pool. He or she purchases the lottery tickets and distributes copies of the numbers to everyone who chipped in their money. And then there are those who treat the purchase far more casually. Of course, none of it matters unless the winning numbers come from the pooled funds.
Group Purchase of Lottery Tickets
Your first question may be a concern about a group purchase of lottery tickets. The Texas Lottery Commission offers some important guidelines regarding those who pool funds together to buy lottery tickets. In short, there’s no restriction on people chipping in cash to buy tickets. However, there are limitations when it comes to claiming the prize.
To most, it would seem easy enough to just turn in the names of the participants and ask for a split of the winnings. Unfortunately, it’s not as simple as it sounds. Under Texas lottery law, only one individual can claim the prize. Notwithstanding, there is another option. A legal entity may also turn in a winning ticket and receive the proceeds.
The person or entity looking to get paid on the winning prize is known as the claimant. Lottery ticket claimants may be one of the following:
- Legal trust
- Limited Liability Company
- Any other legal entity
We mentioned earlier that some lottery pools have rules in place regarding claiming winnings. With or without formal guidelines, it is a good idea to speak with a lawyer before presenting the tickets for redemption. Most groups will opt to create some type of legal entity, which requires the assistance of an attorney experienced in gaming law.
It is often a challenge to determine what type of entity will work best for the beneficiaries. Tax and financial planning are important considerations in setting up the legal entity.
Lawsuits Regarding Lottery Pools
As much as a collaboration of funds can be a good thing, there can be legal issues arising from lottery pools. Take a look at this news article that outlines some problems throughout the country when groups got together and purchased tickets.
One New Jersey man bought a lottery ticket with fellow construction worker buddies. When he found the ticket was worth more than a few million dollars, he just called out sick. His co-workers figured out their colleague was holding out on them and brought him to court. The court divided the pot.
Most commonly, it appears that the person buying the tickets claims to win on a ticket purchased outside the pool. Of course, the problem could be averted if all participants were provided with copies of the tickets.