Comments on: Would You Buy a $150 Raffle Ticket For a Chance to Win a $350,000 House? http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/ Helping a unique generation achieve financial independence. Thu, 24 May 2012 01:09:21 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: kidswriter http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/comment-page-1/#comment-473414 kidswriter Fri, 20 Jan 2012 19:52:21 +0000 http://genxfinance.com/2007/02/28/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/#comment-473414 There are many reasons to enter a charity raffle. One is simply the willingness to help others, the other is simply the fun of seeing if you win something. The cost of a ticket can be significant but the largest issue is the taxes incurred if you win a property. One organization is taking a different tack in this instance stating in the rules that if you win the first prize you have 2 choices. One is to Take a smaller cash payout. The other is to buy the property for $1000. The organization running the raffle owns the property and if you win you win the option of buying the property offered for the $1000. This makes the transfer of property a sale and not a prize in a raffle which is classed as gambling and subject to anywhere from 25 to 33.3 percent property taxes. This huge tax expense is eliminated if the the winner chooses to buy the property. In this way the new owner is now only responsible for the property taxes in the county where the property lays. There are many reasons to enter a charity raffle. One is simply the willingness to help others, the other is simply the fun of seeing if you win something. The cost of a ticket can be significant but the largest issue is the taxes incurred if you win a property. One organization is taking a different tack in this instance stating in the rules that if you win the first prize you have 2 choices. One is to Take a smaller cash payout. The other is to buy the property for $1000. The organization running the raffle owns the property and if you win you win the option of buying the property offered for the $1000. This makes the transfer of property a sale and not a prize in a raffle which is classed as gambling and subject to anywhere from 25 to 33.3 percent property taxes. This huge tax expense is eliminated if the the winner chooses to buy the property. In this way the new owner is now only responsible for the property taxes in the county where the property lays.

]]> By: KellyG http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/comment-page-1/#comment-123213 KellyG Sun, 29 Nov 2009 16:46:21 +0000 http://genxfinance.com/2007/02/28/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/#comment-123213 Hey Jeremy - This is an interesting concept that I am doing some research on... I liked your article and comments. Do you have any follow-up or details you can share about this raffle: where was this home located, how was it advertised? Did it end up working out for all parties? Thanks... Kelly G Hey Jeremy – This is an interesting concept that I am doing some research on… I liked your article and comments. Do you have any follow-up or details you can share about this raffle: where was this home located, how was it advertised? Did it end up working out for all parties? Thanks… Kelly G

]]> By: Jeremy http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/comment-page-1/#comment-1668 Jeremy Wed, 14 Mar 2007 11:58:00 +0000 http://genxfinance.com/2007/02/28/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/#comment-1668 Well I guess it doesn't matter now. I found out today that the tickets were all sold out in less than 48 hours. So I didn't get to purchase one, so now we'll never know. Oh well. Well I guess it doesn’t matter now. I found out today that the tickets were all sold out in less than 48 hours. So I didn’t get to purchase one, so now we’ll never know. Oh well.

]]> By: mbhunter http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/comment-page-1/#comment-1666 mbhunter Wed, 14 Mar 2007 05:09:45 +0000 http://genxfinance.com/2007/02/28/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/#comment-1666 If you keep entering contests, the odds that you'll win at least one of them improves with each one you enter. If you keep entering contests, the odds that you’ll win at least one of them improves with each one you enter.

]]> By: LAMoneyGuy http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/comment-page-1/#comment-1430 LAMoneyGuy Fri, 02 Mar 2007 22:51:14 +0000 http://genxfinance.com/2007/02/28/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/#comment-1430 I have participated in a raffle like that. The house was worth a million, but they also sold more tickets. I think it was also for $150. Strictly speaking, the odds are bad, and you shouldn't do it. (expected value I have participated in a raffle like that. The house was worth a million, but they also sold more tickets. I think it was also for $150. Strictly speaking, the odds are bad, and you shouldn’t do it. (expected value

]]> By: Traciatim http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/comment-page-1/#comment-1424 Traciatim Fri, 02 Mar 2007 15:48:38 +0000 http://genxfinance.com/2007/02/28/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/#comment-1424 My spouse and I recently purchased tickets on a similar draw in my area at the end of last year. We purchased the tickets in November for the draw held on December 28th. In that case there were only 2500 tickets sold, and we each had some spare cash for the month so we figured it was better than a couple of nights out at a high calorie meal. The sheer thought of having a 1 in 1250 chance of winning a brand new house for a month was worth it to us, especially because we were just ramping up to buy a house in the beginning of the new year. It's sad to say we didn't win, but now we are moving from our apartment in to a brand new house we just purchased anyway. If a similar thing happens this year I'll probably buy a ticket again, as long as we have the cash set aside for it. Plus, in Canada, no tax on winnings :) My spouse and I recently purchased tickets on a similar draw in my area at the end of last year. We purchased the tickets in November for the draw held on December 28th. In that case there were only 2500 tickets sold, and we each had some spare cash for the month so we figured it was better than a couple of nights out at a high calorie meal. The sheer thought of having a 1 in 1250 chance of winning a brand new house for a month was worth it to us, especially because we were just ramping up to buy a house in the beginning of the new year.

It’s sad to say we didn’t win, but now we are moving from our apartment in to a brand new house we just purchased anyway. If a similar thing happens this year I’ll probably buy a ticket again, as long as we have the cash set aside for it. Plus, in Canada, no tax on winnings :)

]]> By: Thuy http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/comment-page-1/#comment-1422 Thuy Fri, 02 Mar 2007 14:07:38 +0000 http://genxfinance.com/2007/02/28/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/#comment-1422 We recently had a raffle like that in my town. The charity was selling $40 tickets, maximum of 1,400 tickets. We thought the odds of winning sounded pretty good, but the prizes were not anything of interest to us. After the raffle there was a board posted announcing the winners. Only 1,007 people had bought tickets! I was sure they would sell out, but it turned out that the few who bought in ended up with even better odds than expected. We recently had a raffle like that in my town. The charity was selling $40 tickets, maximum of 1,400 tickets. We thought the odds of winning sounded pretty good, but the prizes were not anything of interest to us. After the raffle there was a board posted announcing the winners. Only 1,007 people had bought tickets! I was sure they would sell out, but it turned out that the few who bought in ended up with even better odds than expected.

]]> By: Wes http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/comment-page-1/#comment-1409 Wes Thu, 01 Mar 2007 02:38:50 +0000 http://genxfinance.com/2007/02/28/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/#comment-1409 It's not such a bad deal. The expected value of one of these tickets (before taxes) is about $100. Here's how you get that: $350k + $21k + $15k = $386k Odds of winning: 1/3800 Thus: $386k / 3800 = $101.58 For the record, last friday night I went to a fund raiser that included a raffle. I bought 3 tickets (for $2 each) just for fun and to support a good cause. I guess there were 1000 tickets sold. Surprisingly I won a 1GB iPod Suffle (worth $80). Sooo... based on past experience... I'd buy that ticket. It’s not such a bad deal. The expected value of one of these tickets (before taxes) is about $100.

Here’s how you get that: $350k + $21k + $15k = $386k

Odds of winning: 1/3800

Thus: $386k / 3800 = $101.58

For the record, last friday night I went to a fund raiser that included a raffle. I bought 3 tickets (for $2 each) just for fun and to support a good cause. I guess there were 1000 tickets sold. Surprisingly I won a 1GB iPod Suffle (worth $80). Sooo… based on past experience… I’d buy that ticket.

]]> By: Jeremy http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/comment-page-1/#comment-1405 Jeremy Wed, 28 Feb 2007 19:52:44 +0000 http://genxfinance.com/2007/02/28/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/#comment-1405 mapgirl, the good news is (which I forgot to mention) is that for the house and vehicles you can elect to receive a lump sum cash option and they just automatically withhold the taxes from that. That is what I would do personally since I have no need for a new vehicle (plus registration, insurance, taxes...) and we already own a decent home. And since the location of the home is in a more affluent area and given the value I don't think I would want to be stuck with owing taxes on the prize plus the property tax bill! mapgirl, the good news is (which I forgot to mention) is that for the house and vehicles you can elect to receive a lump sum cash option and they just automatically withhold the taxes from that.

That is what I would do personally since I have no need for a new vehicle (plus registration, insurance, taxes…) and we already own a decent home. And since the location of the home is in a more affluent area and given the value I don’t think I would want to be stuck with owing taxes on the prize plus the property tax bill!

]]> By: mapgirl http://genxfinance.com/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/comment-page-1/#comment-1404 mapgirl Wed, 28 Feb 2007 19:48:19 +0000 http://genxfinance.com/2007/02/28/would-you-buy-a-150-raffle-ticket-for-a-chance-to-win-a-350000-house/#comment-1404 The odds are way better than a trillion to one for the lottery. But factor in your taxes for your prize winnings. That's coming out of your pocket with the raffle ticket cost if you win. Reminds me of those dream home reality show winners who couldn't keep the house because of the property taxes, or the space flight winner who turned down the prize because of the tax bill. The odds are way better than a trillion to one for the lottery. But factor in your taxes for your prize winnings. That’s coming out of your pocket with the raffle ticket cost if you win.

Reminds me of those dream home reality show winners who couldn’t keep the house because of the property taxes, or the space flight winner who turned down the prize because of the tax bill.

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