Bankruptcy

What If We Win the Lottery After We File our Bankruptcy?

By Joseph McDaniel, Esq.

Did you own the lottery ticket prior to filing? Well, you shoulda listed it in your bankruptcy schedules. And it, and the winnings, belong to your bankruptcy trustee who will take the winnings, use them to pay your creditors in full, including penalties and interest and maybe legal fees, and then you'll get the rest, residue and remainder. If any.

Could be worse, I guess.

Did you buy the lottery ticket with earnings from a time period after your first paycheck following the filing of the bankruptcy?

If so, the winnings are probably yours, free of the claims of the bankruptcy trustee and estate. See, for instance, 11 USC 541 as it relates to wages in a Chapter 7 case.

Although a Chapter 7 bankruptcy trustee has smart lawyers; they may well cobble together some kind of cockamamie legal theory to make you want to kick 'em a little dough just to see their heels disappearing in the distance.

You know?

NOTHING HERE CONSTITUTES LEGAL ADVICE RE A CHAPTER 7, CHAPTER 13, CHAPTER 11, OR CHAPTER 12. FIND AN ARIZONA BANKRUPTCY LAWYER WHO IS BOARD CERTIFIED IN BANKRUPTCY LAW, AV RATED, AVVO 10 RATED, ON SUPERLAWYERS, OR JUST VERY EXPERIENCED AND A FORMER CHAIR OF SOME BANKRUPTCY SECTION OR COMMITTEE. NOTHING HERE MAY BE USED AS LEGAL ADVICE IN CONNECTION WITH ANY BANKRUPTCY, WHETHER THAT BANKRUPTCY IS IN PHOENIX, GLENDALE, TEMPE, MESA, SCOTTSDALE, OR ANYWHERE ELSE.

Full post as published by Arizona Bankruptcy Attorney Blog on June 26, 2010 (boomark / email).