Lump Sum vs. Annuity Payments for Casino Winnings

Lump Sum vs. Annuity Payments for Casino Winnings

Consult with a Certified Financial Planner™ professional, tax attorney or certified public accountant to help determine the best decision for your payout.

PRO TIP

Each payout method comes with its own set of tax implications, including higher interest rates. Choosing how to receive your winnings determines how much you cash in.

Choosing a Lump Sum

Choosing the lump sum option means settling for cash at a 50-60% discounted rate of the total winnings.

You'll get a bulk of cash all at once, but will have to pay taxes on the sum in its entirety the same year it's distributed.

These taxes are paid only once, so this option may work best for those looking to pay off debt or address other immediate financial needs.

Choosing an Annuity

Choosing an annuity means committing your winnings to a long-term payment plan that can take 20 to 30 years to fully disburse, guaranteeing an additional income stream over time.

Leaving casino winnings in an annuity sacrifices some of the value of your money.

REMEMBER:

You should speak with a financial professional about your options and your current financial situation.

They will be able to determine what course of action is best for you.