It can be fun to fantasize with co-workers how you would buy your company or retire en masse if the office pool won the lottery. And with Powerball’s record-setting payout at $1.5 billion, there are probably more colleagues playing “what-if.”
But the elation of hitting the jackpot can quickly turn into nasty lawsuits if the office pool was sloppily put together. It’s not without precedent.
Two bakery workers in Chicago sued co-workers after they were left out of the winning office pool. Their suit was eventually dismissed. An Ohio man out on medical leave sued his lucky co-workers for not chipping in for him, as he claimed was routine. He also lost his case. But a group of New Jersey construction workers won $20 million from a colleague who claimed the winning ticket was his personal one and not one he bought on behalf of the office pool.
To keep such contention out of your office pool, consider these tips from the New York State Gaming Commission:
1. Elect someone to be responsible for collecting and keeping track of the contributed money.
2. That person should maintain a list of all participants, note who opts out and distribute the list to everyone who is on it to make sure there’s no confusion. For those who are absent, have the group chip in to cover that person or, at the very least, email that person to see if they want to be included.
3. Decide who should buy the ticket, where it should be purchased and when it will be bought.
4. Make a copy of the ticket or tickets and distribute before the drawing. This is especially important if the buyer is also purchasing their own tickets.
5. Check with your state’s lottery commission to see if it limits how many checks can be issued for one prize. If there’s a limit, consider limiting the office pool to that number.
If the office pool is bigger than the state commission’s limit and the group wins, there are a few other options for collecting. First, the winners can form a limited liability company listing each person in the pool as an owner. The lottery will pay the LLC and the group leader will distribute individual checks. Or, they can create a trust that lists each pool member. Winnings go to the trust and the group leader gives out each individual’s share of winnings. The last option is to elect a number of people in the pool to receive the prize, deal with the taxes and distribute funds to everyone else.