It appears that at least some of our players are serious about planning ahead – and they very clearly intend to win the lottery! I recently got a telephone call from a group of co-workers who play the lottery in an office pool. And they’d gotten into a big debate about what would happen when the time came for them to claim a big prize.
Some members of the group thought they would want to claim the prize as the cash option while others said they might want to choose annuitized payments over time. So they wanted to know: Could they have it both ways?
The short answer is no, but there are more details involved than that. When a prize is claimed here at the Iowa Lottery, we write just one check to one person or entity. There are a variety of security and financial rules in place requiring that to happen. So, if you’re claiming a prize as part of a group, you can claim it as a trust, or the check can be written to just one particular person in your group. The entire group has to decide on the cash or annuity option before the prize is claimed.
A tax form is filled out at the time – Federal Form 5754 – that details how the prize is being divided and identifies the people who are claiming it. It lists each of the winners along with their address and tax identification information to ensure that the prize and taxes withheld are allocated correctly to each group member. It’s a pretty simple process, and we have that paperwork here at the lottery, or if you want to fill it out in advance, we have links to the forms on our website.
Check out the Frequently Asked Questions on our website as well for more info. about claiming a lottery prize.
Good luck to your group that plays the lottery! And yes, we’ll make it a big celebration when you come in to claim that big prize!