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“Isn’t the money that I won mine?”

     Question:  I won money in the Texas Lottery.  A couple of weeks before I bought the ticket my husband and I became separated.  Isn’t the money that I won mine?  My husband says that we own the money equally.

Answer:  Two issues addressed by the question are is money that is won in a lottery the sole property of the married spouse who purchased the winning ticket and does being separated in Texas make a difference when lottery money is won?  The answer is more understandable by answering the second question first.  Texas is a “date of divorce” state.  That means that when a couples’ divorce is finalized their property and debts are divided as of that date.  

Property includes real and personal property.  Real property is land and all improvements and personal property is everything else.  Things like the value of a marital residence and the value of a retirement account are determined as of the date the divorce is finalized.  The period of time in between the actual date of separation and the date of divorce may or may not ever matter.  One reason for that is to encourage married couples to remain married.  Also, debts that a spouse acquires or accrues during the period of separation are often awarded to that party when the divorce is finalized.

Property acquired during the separation remains the community property of the marital estate until the date of divorce. The value of the marital residence may go up or down during the separation period, and a party may win a lottery.  All of the community property of a marital estate must be divided upon the divorce of the parties.

Lottery winnings in Texas that are won by a married spouse are the community property of the married couple.  That’s because the only property that is not characterized as the community property of the married couple is property that is received by one of them as a gift, or through a Will or inheritance or awarded for pain and suffering from a personal injury.  All other monies and property received during marriage belongs to the marital estate, even if the parties are actually separated and living apart.  Lottery winnings are considered a source of income when won, and not a gift from the state.  All income earned during marriage belongs to the marital couple in Texas.  (A couple could keep their income earned during marriage separate through a specific post marital agreement.)

An issue to consider; however, is that Texas is a community property state, but not a 50/50 state and a judge in a divorce proceeding must divide the property among the parties in a manner that is “fair and equitable, just and right.”  That is not necessarily 50/50, but it could be.  A judge must hear evidence on why property should be divided in a particular manner.  Things that a judge would consider are the education of the parties and each spouse’s ability to earn a living, disabilities of either spouse, children of the parties and who they reside with, other property available for division, fault on the break up of the marriage and so on.  

A lottery ticket purchased just after a couple separates is the community property of the couple’s marital estate.  A judge that may have to divide the proceeds of the lottery would consider circumstances of his parties.  One may be whether or not a divorce proceeding had been filed before the ticket was purchased and what fault allegations may have been alleged in the petition for divorce.  If the parties’ marriage does end in divorce, and all things are fairly equal between the parties and if fault is not determined to be the reason the marriage failed, then the lottery winnings are likely going to be awarded equally between the parties.  

Any married spouse in Texas who wins money in a lottery should consider potential consequences for failing to disclose the winnings to their spouse or in hiding or secreting the winnings from their spouse.  Even if a lottery is won during good times in the marriage, attempting to keep the other spouse from the benefits of the winnings could be a problem should the couple ever divorce.  A judge may look back to that deception and determine that the deceived spouse is entitled to a greater portion of the winnings.

This article is meant for informational purposes only and not as a substitute for sound legal advice.  Direct questions to Ask the Lawyer to robin@robinscottlaw.com.