Lottery and Divorce – Impact on Alimony & Child Support
Exhibit one in for lottery and divorce issues. The Huffington Post has an article this week entitled Woman Asks Ex Who Won Mega Millions Lottery: Can I Stop Paying Alimony? During the marriage, the wife had been the primary breadwinner, and was ordered to pay five years of alimony upon divorce last fall.
Five months later, her ex-husband won $273m in the Mega Millions Lottery, and the wife is now wanting to stop her maintenance payments, which she characterized as “pocket change” to the big winner. (None of the news articles indicated how much spousal maintenance she was paying, but compared to $273m, pretty much any amount would be pocket change).
Since somewhere between 25% and almost half of all marriages end in divorce, chances are there will be divorced men and women among those lucky few who won the lottery. And those big winners may be paying, or receiving, child support or alimony. Exhibit two for lottery and divorce issues is another headline several years ago which proclaimed $5.3 Million Lottery Winner Hit for More Child Support.
Lottery & Gambling Winnings Count as Income for Alimony or Child Support
First, if you won the lottery after divorce, and are curious about the impact on your family support obligation, then congratulations to you!
The reason why lottery and divorce issues matter is that many states, including Colorado, gambling winnings (known as “monetary prizes” in the statute) count as income for purposes of alimony or child support. See C.R.S. 14-10-115(5)(a)(I)(V) (for child support) and C.R.S. 14-10-114(8)(c)(I)(V) (maintenance), which both have the same language under the definition of what counts as income:
“Monetary prizes, excluding lottery winnings not required by the rules of the Colorado lottery commission to be paid only at the lottery office”
And if a person were blessed with the luck (or, in the case of poker, the skill) to win big, and win consistently, those winnings would count as income to determine an appropriate level of child support or maintenance.
But most people won’t win enough playing poker, blackjack or slots at the casino to move the needle on child support. And in most cases, such winnings are not large enough to be publicized, so the ex-spouse or other parent probably would never even know of the win. Practically speaking, despite the law counting gambling winnings as income, most of the time it’s only the lottery and divorce which matters, and other gambling winnings rarely end up affecting child support or alimony.
So while a big lottery winner may have to give up a bit of the prize in increased spousal or child support, most people won’t. Note, however, that a big winner will hit the caps for statutory maintenance or child support, so the spouse seeking an increase will have to justify why it’s appropriate.
FAQ – Lottery and Divorce Family Support
What happens if you win the lottery after divorce?
If a person wins the lottery with a ticket which was purchased after divorce, the winnings are not considered marital property the ex-spouse can get a share of. However, the winnings are considered income, and could result in an increase in child support or spousal maintenance.
After a divorce is final does the ex have any rights to lottery winnings?
If a lottery ticket is purchased during the marriage, then the winnings are marital property subject to division in a divorce, no matter when the win was announced. However, if the ticket was purchased after divorce, an ex-spouse has no right to the winnings, although they will count as income for purposes of potentially increasing child support or maintenance.
Is gambling income considered income in a divorce?
Yes. In Colorado, gambling income counts as income for purposes of child support and maintenance. But unless one spouse wins the lottery, most people do not have winnings which are high enough, or consistent enough, to have a substantial impact on a family support obligation.
More Information on Lottery and Divorce Support Issues
For more information about how gambling and lottery winnings can affect child or spousal support, read the creatively-titled article Lottery, Gambling, Child Support & Alimony in the Colorado Family Law Guide. The article has an in-depth discussion of the actual statutes and cases on this issue.
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