Estate planning attorneys are often the recipients of bad news – news of death, illness, disability and divorce. But playing this role also means we get to hear our clients’ good news too – news of new babies, college graduations, and well-planned inheritances. A client recently called with some fun, exciting news that we had never heard before. Larry* had won the Massachusetts lottery, and he had won big – a $1,000,000 prize.
Larry called because he had some legitimate concerns about how to handle the lottery money. He and his wife had already decided that they would take the lump sum payment, rather than a twenty year annuity. That meant that his take home winnings, less income tax withholding, would leave them with about $460,000. They intended to use the money to pay off some debts and contribute to retirement savings. They were very concerned about anonymity. They didn’t want anyone – including their adult children and close family – to know about the winnings. They feared they would demand money.
We helped Larry solve this problem. We established a Trust to receive the lottery winnings. The Trust was a declaration and had no donor. Dale Kaiser was named as Trustee. The name of the Trust did not identify Larry. The Trust received the money and then immediately distributed it outright to Larry. He could then use it as he planned. The Trust ensured Larry total anonymity.
In early June, as Trustee, Dale went to the Massachusetts Lottery Commission to get the lottery proceeds check payable to the Trust. A couple days later, the Trust distributed the winnings to Larry. It was an exciting week at the Kaiser Law Group!
*Not our client’s real name.