Valuation of Lottery Prize Payments for Estate Tax Purposes: An Analysis

Authors

Ted D. Englebrecht, Louisiana Tech University
Mary M. Anderson, University of Southern MIssissippiFollow

Document Type

Article

Publication Date

6-1-2007

School

Accountancy

Abstract

The article discusses the opposing rulings regarding the valuation of future lottery payments. The U.S. Internal Revenue Service (IRS) and the Tax Court advocate using the actuarial formula. Taxpayers view fair market value method as proper valuation. The controversy lies in the marketability and assignability restrictions of the lottery payouts, which are crucial using the fair market value methodology. Recommendations on how to solve the controversy are included in the article.

Publication Title

CPA Journal

Volume

77

Issue

6

First Page

52

Last Page

59

Recommended Citation

Englebrecht, T. D., Anderson, M. M. (2007). Valuation of Lottery Prize Payments for Estate Tax Purposes: An Analysis. CPA Journal, 77(6), 52-59.
Available at: https://aquila.usm.edu/fac_pubs/20565