9:30 AM Class Group 5

Tyler Larrivee

Habibullah Olomi             

Stephen Miske

Pedro Muniz

Lottery Annuities

$50,000 Monthly payment

-25% Federal taxes ($12,500)

-5% State Taxes ($1,875)

$35,565 Amount received at the beginning of every year.

$35,565 * 6% Interest =$2,137.50

$2,137.50 * 25% (Federal Tax on interest)=$534.38

$2,13750

-$534.38

$1603.12 * 5% (State Tax on interest)= $80.16

$1603.12

- $80.16

$1522.96 amount of interest received after 1st payment.

$35,565 +$1522.96 =$37,087.96

$37,087.96

+$35,565.00 2nd Payment

$72,772.96

$72,772.96 * 6% interest = $4,366.38

$4,366.38 * 25%(Federal Tax on Interest) =$1,091.60

$4,366.38

-$1,091.60

$3,274.78 * 5% (State Tax on Interest) =$163.74

$3,274.78

-$163.74

$3,111.04 Interest after 2nd payment

$72,772.96

+$3,111.04

+$35,565  3rd Payment

$111,509.00 *6%  = $6,690.54

$6,690.54 '' (25%) =$1,672.64 =$5,017.90

$5,017.90 '' (5%)= $341.78 =$6,493.90

$111,509.00

+$6,493.90

+$35,565 4th Payment

$194,019.76 After 4th payment

.

.

.

$1,091,631.13 *(6%) =$70,435.40

$70,435.40- (25%)= $17,608.85= $52,836.55

$52,836.55- (5%)= $2,641..33 = $50,185.22

$1,091,631.13

+ $  50,185.22

+ $  35,565 last Payment

$1,259,733.58 Amount received at the end