What to do if you win the lottery
Sign the ticket, put it somewhere safe and tell almost nobody. Everything after that has a deadline measured in months, not hours, and the winners who come off worst are usually the ones who hurried.
This is the order I'd follow. It isn't legal or financial advice, and the rules for claiming are set by the lottery that sold the ticket, so where I give one lottery's rule, I say whose it is.
Make sure, then sign it
Check the numbers against the official result, on Powerball's site, Mega Millions' or your state lottery's, not a screenshot someone forwarded you. Then sign the back. Mega Millions says it as plainly as anyone: "Unless signed, anyone in possession of the ticket can file a prize claim."
After that, I'd make a copy or a photo of both sides and put the ticket itself where you'd put a stack of cash, because that's what it is. A fire safe at home, a safe deposit box at the bank. Not the glove box, and not your wallet.
If the ticket belongs to a pool, stop before anyone signs it. Who signs and who claims is a group decision, and the lottery syndicates page covers how groups do it.
Find out how long you have
Most winners have more time than they think. Powerball says ticket expiration dates typically run from 90 days to one year, depending on the lottery that sold it, and that the date is often printed on the back of the ticket. Read your lottery's claim page for that date, where to go, what ID to bring and whether you can claim by appointment.
On a small prize none of this matters much. Powerball says you can generally claim up to $600 at any licensed retailer. On a large one, the deadline is your friend. It gives you weeks to get people around you before the lottery, the bank or the public know anything, and I'd use most of them. The jackpot claims page has the rules in detail, including where you have to go and how long the lottery's own checks can take.
Keep quiet
I'd tell my spouse and nobody else until the advisers are in place. A win is news that can't be taken back, and whether the lottery can keep your name private afterwards depends on the state. Some publish winners' names by law, some let you stay anonymous, some only above a certain amount. If yours allows it, I'd ask for it.
Get the right people
On a prize that changes your life, I'd want three professionals before I walked into the lottery office, and I'd want each of them to have been paid by the hour, not by a slice of the money.
- a tax professional, because the tax bill is part of every decision that follows
- a lawyer, for the claim itself, whether a trust or company is worth using where you bought the ticket, and your will
- a fee-only financial planner, once the money exists, for where it goes
I'd find them myself. Not through anyone who calls, writes or turns up at the door because they heard. That's an opinion, not a rule, but I've watched how money attracts people, and the ones who find you first are seldom the ones you want.
Know the tax before you spend
The lottery takes federal tax off the top: under the IRS instructions for Form W-2G it withholds 24 percent when the winnings minus the wager are more than $5,000. On a jackpot that isn't the whole bill. A big prize puts you in the top bracket, so part of what you owe is still owed at filing time, and the state may want its share too, depending on where you live. The lottery taxes page has the arithmetic. I'd put the difference aside the day the money arrives and not touch it.
Choose cash or annuity
A Powerball or Mega Millions jackpot is paid either as the cash in the pool now or as 30 payments over 29 years. Neither is the bigger prize, and the right answer depends on you more than on the numbers. The annuity or lump sum page lays out both, with the tax on each. Ask your lottery when you have to choose, and make the choice with the tax adviser in the room.
Expect the scams
Once a win is public, the approaches start, and some of them are frauds dressed up as the lottery, a charity, a government office or an old friend. The rule that stops most of them is simple: the money only goes one way. Powerball says lotteries will never ask you to pay a fee to collect a prize, and the FTC says that if you have to pay to get your prize, it's a scam. The lottery scams page has the signs.
Then, nothing for a while
Once it's claimed, I'd leave the money alone for a few months. Pay off what needs paying, set the tax aside and make no promises. The advisers can build a plan once you know what your life looks like with the money in it, and that takes longer than people expect. (The car will still be for sale in six months.)
If a win has you buying more tickets to chase the next one, or someone close to you is, the responsible gambling page is where to go. And if you're reading this before any win, the honest odds are on how to win the lottery. Bookmark this one anyway. It's cheaper to read now.