A word of Dutch origin, the word lottery may be derived from Middle Dutch loterie or calque on the Middle Dutch word lotinge. The Oxford English Dictionary gives a definition for the word lottery, but it is unclear how the English term got its start. The earliest state-sponsored lotteries in Europe were held in Flanders in the 15th century. In 1569, the first English state lottery was held, and advertisements had been printed two years earlier.
Early American lotteries
Early American lotteries were a common method of raising funds for the colonies. They were often located in the South, where money was scarce and lotteries proved an effective way to raise money for schools and new homes. There was no grim purpose behind the lotteries, though – in 1786, the Massachusetts Land Lottery disposed of fifty townships. As a result of the lottery, the President and Fellows of Harvard College bought twenty tickets and won 2,720 acres of land in the Maine region.
A group of recent Ivy League graduates is making a run for lotteries in several states, and has so far cashed in more than $6 million in lottery winnings. The group’s winning strategy remains a mystery, but some of the members claim to be friends with the man. One of the group members, Manuel Montori IV, is a 27-year-old Princeton University graduate who cashed in 61 winning Hoosier Lottery scratch-off tickets in Indiana in September.
Whether you’ve ever been tempted to check your mailbox for an unclaimed lottery prize, you’re certainly familiar with the stories of jackpots that have gone unclaimed. These tales have been a source of wonderment for the lottery’s operators and a reason to celebrate for winners. In Connecticut, for example, lottery officials have placed posters in convenience stores and have relied on local media to let people know about unclaimed lottery winnings.
Taxes on winnings
There are a number of tax consequences to winning a lottery. You may have to pay taxes on lottery winnings that don’t come in the form of cash. If you decide to sell your prize, you will have to pay taxes on the amount of the prize tax. If you decide to take a cash settlement, you can avoid paying tax on the prize by forfeiting it or donating it. Regardless of the tax consequences, you should know how to spend your windfall to make the best decisions for your future.
Opponents of lotteries have both economic and political arguments for and against their use. They say that a lottery does not serve the public good by stimulating the local economy or creating jobs. Other opponents say that the lottery does not contribute to state budgets and that lottery players do not purchase their tickets locally. Nevertheless, economic arguments for the lottery are more than just naysayers’ objections. Lotteries can actually serve public policy and must be regulated in order to protect the taxpayers’ rights.