the same reason that you’re better off taking the lump sum vs the 30 year pay out if you win the lottery.
money today that i can use today is worth more than money tomorrow.
You might be theoretically better off in an ideal outcome, but I’m pretty sure taking the 30 year payout is the generally recommended option. If I were to win the Mega Millions at the current level, I would need to make investments that paid $96,244,081 over 30 years just to equal the tax savings of taking the annuity versus the lump sum payment. That works out to a 3.1% return on the initial lump sum, every year, 30 years straight. Granted, this isn’t exactly impossible, but it does require a few caveats. For example, this assumes you don’t actually spend any of that money, investing 100% of it and never having a bad year. Of course, the average lotto winner is not exactly known for their great ability to invest their money. Meanwhile, there’s nothing preventing the person taking the 30-year annuity from investing a portion of their annual payouts, which are guaranteed, while returns on investments are explicitly not guaranteed.
A guaranteed $96,244,081 return is a better investment than a possible $200,000,000 that’s continent on absolutely nothing going wrong for the next 30 years, but the sort of people who run companies seem to forget about this these days.