Dividing Lottery Winnings in a Divorce

by admin

In June 2019, a Michigan arbitrator awarded a spouse $15,000,000 out of lottery winnings. Almost two years after separating, the husband won $80 Million (after taxes and costs, he only netted about $39 Million).  Despite his best efforts to keep his soon-to-be ex-wife from having any of the lottery winnings, she ultimately received almost 40% of the winnings.

Here’s the Yahoo Story for more information. 

So what would happen to lottery winnings in a Texas divorce?

Texas is a community property state. That means that whatever each spouse brings into the marriage during the marriage belongs to both spouses equally. So it would seem that lottery winnings are community property as long as the win occurred during the marriage.

However, as with any case, other factors may come into play. There can be arguments in a Texas divorce case that more of the lottery winnings (or even all of the lottery winnings) should be awarded to one spouse.

In Texas, the family law judge has the right to make a determination of a “just and right” division of the marital assets. Things the judge can consider when it comes to lottery winnings include:

  1. Were the parties separated at the time of the lottery win?
  2. How long had the parties been separated at the time of the lottery win?
  3. How was the lottery ticket purchased? Was community funds used? Was it purchased through a group at work?
  4. Was a Temporary Order in place prior to the lottery win?
  5. Who was paying for community liabilities and debts?

Depending on the answers to these questions, a Texas divorce attorney could argue to the judge that one party should be awarded all or more of the lottery winnings. The more disconnected to the marriage the situation, the more likely a judge may be to award more of the money to one spouse. For instance, if the parties had been separated for a long time and the parties had been paying their own bills through their own bank accounts, you may see the lottery winner get more of the money. But, it is important to know that the family law judge has a lot of discretion in determining what is “just and right”.

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