Lottery Winnings Are Not a Matter of Chance

Equitable property division sometimes makes for differences of opinion by judges about what is fair, but in one area, courts are almost entirely of one mind: the division of lotteries. Lottery winnings, whether from tickets purchased during a marriage or during a separation preliminary to a divorce, are marital property and subject to equitable distribution between the spouses.

In the case of winnings from a ticket purchased during a marriage, the courts find little trouble dividing winnings in half. In one 1990 Illinois case, In Re Mahaffrey, the husband argued that the lottery proceeds were income, paid in his name, and that they were his sole and separate property. The court brushed aside this argument, stating that the title theory of ownership was no longer recognized in equitable distribution, and likening lottery installment payments to pension rights subject to distribution.

Even when the ticket is purchased during a period of separation but before the divorce, courts have said that the winning proceeds are marital, not separate property, particularly in jurisdictions where the date of classification of assets is the date of dissolution of the marriage.

Even in cases where the an interlocutory decree has been handed down, courts have held that in so far as lottery winnings go, “the parties to a divorce remain husband and wife until the final decree of divorce.”

Winning tickets purchased during a separation may seem to support the argument that the proceeds are separate, but the key seems to be that when a jurisdiction uses the date of filing as the date of classification, lottery winnings are marital property.

In general, as far as lotteries and proceeds go, it is not over until the fat lady sings and she does not sing until the divorce is final.

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