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The Rubinstein Law Firm

For Legal Help, Call
248-220-1415

COVID-19 ANNOUNCEMENT: The Rubinstein Law Firm is dedicated to helping you with your legal needs during these challenging times. We can meet with you virtually (Skype, FaceTime, etc.), or by telephone.

How does winning the lottery work in divorce?

| May 14, 2021 | Divorce

The odds of winning the lottery are slim, but if you land that winning ticket you have a lot to work through including taxes and payout. But if you are in the middle of a divorce, those winnings might become a lottery-sized wrench in your financial paperwork.

Since it is a rare occurrence, there is not much that Michigan has on the books regarding exactly how to divide winnings in a separation. But there are examples here and there to reference.

Mega Millions in Michigan

According to a 2019 report from NBC News, a Michigan man won the $80 Mega Millions lottery two years into his divorce proceedings. Since the courts had not finalized the divorce, arbitration ruled that the $1 the man spent on the ticket was technically marital income and therefore a joint investment.

Courts agreed and, after taxes and deductions reduced the total winnings to $38 million, ordered the man to pay $15 million to his ex-spouse.

Lottery and timing

If you find yourself in the same situation, no matter the winnings, the timing of the divorce comes into play. If the lottery ticket hits before a divorce, it probably counts as marital income for property division. During divorce, like above, it might go to arbitration. Litigation may provide a defense against an equitable divide depending on where in the divorce finalization process you are. But it is no guarantee.

After divorce gets trickier. Though the winnings tend to belong to you alone, the amount of winnings may constitute a change of income drastic enough to merit an adjustment appeal for spousal support. If you win big, it may impact your alimony. In these odd circumstances, there are tools and resources to help get things sorted.

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