Lottery Pool

In theory, all you need to start a lottery pool is at least one other player and a pot of money to purchase tickets with. It is a good idea, however, to draft a written agreement before you begin, so there can be no disputes when it comes time to claim any prizes. Follow the steps below to get your own office lottery pool up and running:

• Recruit Players

  It’s up to you how many people you want in your pool, but note that some state lotteries limit the number of claimants that they will pay a single prize out to. It’s worth checking this with your state lottery ahead of time.

• Draft a Lottery Pool Agreement

  This is an important document that sets out the rules of participating in the pool. You can find more information, including draft contracts, further down this page.

• Set Up a Communication Channel

  One important factor of running a lottery pool is keeping in communication with everyone. If you’ve got a pool of 100 colleagues from across an organization, however, this can get complicated. Set up an email distribution list, instant chat group, or social media group, and invite or add all pool members to it. That way you won’t need to message everyone individually to keep them up to date.

• Buy Tickets

  One person, whether that’s you or another nominated member, needs to collect the money from each participant and buy the tickets. It’s a good idea to send copies of the tickets to other members before the drawing.

• Check Your Numbers

  The first thing you need to do once the draw has taken place is check your numbers. Depending on the size of your pool, you might have a lot of lines to check, so use the Ticket Checker to speed up the process.

• Notify the Pool of Any Prizes Won

  If you do win anything, make sure everyone knows about it as soon as possible. This is where an email list or social media group can come in useful.

• Claim Your Prizes

  The claim process can differ significantly between states and will depend on how much you have won. For large prizes such as the Powerball jackpot you may need to provide supporting documents along with the winning ticket. See the How to Claim page for further details.

• Distribute Winnings to Other Members

  The pool manager may be required to distribute prize money to all other members of the group, as in many cases the lottery will not or cannot pay each member individually. In these instances you need to decide how you will transfer the money to other members and include this in your pool contract.

You need to take caution if you’re responsible for purchasing tickets for the pool but are also planning on buying tickets for yourself to play separately. If you do this, disclose it to the group beforehand, and make it very clear before the draw which numbers belong to the pool. You don’t necessarily need to share your own numbers, but it’s a good idea to send copies of the pool’s tickets to all members before the draw. That way, if you do win on one of the tickets you purchased for yourself, there may be some bitterness from the pool members, but you cannot be accused of cheating them out of any prize money.

If you’re the one to suggest starting a pool, it doesn’t necessarily mean you have to manage it. Before you start playing you should state in writing who the pool manager is and what their responsibilities are. Traditionally, the manager will be the one to collect the money for lottery tickets, buy tickets, and initiate any prize claims, but if there are any other specific duties, it’s worth noting these in writing.

Do you need a deputy manager too? If the pool manager is unavailable one week, someone would need to step in and fulfil their duties, and not determining who is responsible for this at the start could lead to confusion further down the line.

Receiving your winnings can be a more complicated affair when playing as part of a group, and the process will differ between states. While some lotteries may pay each individual member of a pool directly, some others may only pay out prizes to a single representative. In these cases you need to think about how the money will be distributed among the other members of the pool to avoid any disputes and the unnecessary payment of taxes.

The California Lottery, for example, will pay each member of a lottery pool directly for prizes totaling $1 million or more, but prizes of a lesser value will only be paid to one group member, who will then need to arrange payment to all other members. In these cases, the other players will need to complete IRS Form 5754 to record where the money has come from. See the Taxes page for more information.

The other option would be to form a trust or other legal entity to claim a prize. You would need to enlist the help of a lawyer and financial advisor to make sure the trust is set up correctly and ensure the prize money is distributed to each member of the pool. Some states do not allow winners to claim through a trust.

Some state lotteries set a maximum number of players that it will pay prizes out to. If the number of players in your pool exceeds this limit, you may need to arrange the transfer of winnings to the additional members yourself. The New York Lottery, for example, allows you to manage a pool of up to 25 members at once, while in California the limit is 100 players.

It should be decided at the beginning which jackpot option your group would go for – either a cash lump sum or annuity payments. Most state lotteries will not be able to pay an annuity to some members and a lump sum to others, so it’s worth setting out right at the start in writing which option your group would take. That way there can be no disputes if the situation arises.

In standard lottery pools, each member contributes the same amount of money and receives an equal share of any prizes. Some pools, however, allow its members to put in more money and therefore receive more of the prize money should they win.

For example, ten players each contribute $2 and agree to split any prize money equally, as they have all put in the same amount of money. A prize of $100,000 would therefore be split ten ways, netting each participant $10,000.

One person then drops out of the group, leaving it with nine members. To ensure that they can buy the same number of tickets in the next draw, one of the remaining group members doubles their stake to $4. At this point it needs to be decided how any future prize money is split. As one person is now contributing twice the money that everyone else is, are they eligible to receive a greater proportion of the winnings? If the group were now to win $100,000, should that person now receive $20,000?

There are no hard and fast rules in place to tell you what should happen in these circumstances. What you should do is discuss the situation with all members of the group to come to a solution that everyone agrees with. After you’ve done that, get it down in writing in your lottery pool contract.

Once you’re ready to start your own pool, or if you’re joining someone else’s, use the checklist below to make sure there’s a robust Powerball pool agreement form in place before the first tickets are bought. It may mean a bit more work up front, but it could save a lot of time and effort in the long run. Note that this list is not exhaustive and it’s always worth consulting your state lottery before you begin.

Things to include in your Powerball pool agreement form:

• A simple statement describing the pool’s purpose, which is to buy lottery tickets as a group and share any prizes won.
• The name of the pool manager and what their responsibilities are.
• The name of the deputy pool manager.
• The names and signatures of all group members.
• Which lottery game(s) the pool will play.
• When the agreement is in effect until (for pools entering multiple draws)
• How much money each member contributes to tickets.
• How numbers are to be chosen: manually, or via Quick Pick.
• When members need to pay their share and what happens if they don’t pay in time.
• What happens if a player leaves the group.
• How prizes are to be divided among the group.
• The number of tickets to be bought.
• Which draw(s) the group will participate in – Monday, Wednesday, Saturday, or all three.
• Whether any add-ons, such as Power Play, are to be purchased.
• Where tickets are kept, who is responsible for them, and if or how other members are to receive copies of them.
• The person responsible for claiming prizes.
• Whether the pool will receive a jackpot prize as an annuity or cash lump sum.
• Whether the pool will go public or remain anonymous (where possible) in the event of a jackpot win.

If you don’t want to go through the hassle of writing your own lottery pool contract, we’ve created some draft agreements that you can use instead. You can view a template for a single-drawing contract or for multiple drawings.

Please note that these draft agreements are samples, and all of the provisions may not be relevant to your pool, or you may have further conditions that are not listed. You should adapt these contracts to suit the needs of your pool, and if you need to make additions, make sure that any separate sheets are attached to the main form.