Ch. 13 and lottery winnings

[debtisbad4u]

Is there any way to get out of my Ch. 13 bankrupcy if I have just won $250,000? My dad said he would claim the prize for me and then turn it over to me. (I trust him very much!) I am converting my ch. 13 to a ch. 7 in June of 2010 I just don't want my scumbag lawyer to think he can get a chunk of this change! Yes, I know I should pay my creditors and I will but not through his grimy hands! I have $50,000 in student loan debt(hence the bankrupcies) that I will pay off too, not a lot left after this, but I have been blessed! kind advice please?

[rrockinggramma]

well the moral thing to do is to turn it over to the court. And many here will say that you need to do that.

But I thought long and hard through out my chapter13 as to what I would do if I won. (have yet to win big. congratulations to you) But I would have your dad claim the ticket and then pay off your bills as needed. None of this money can touch your account in any way. He can't claim it and just hand you over the 125,000 (after taxes). The IRS and the federal reserve keep track of all transactions and they raise eyebrows over anything out of the ordinary.

But I had always planned to let my daughter claim the ticket and pay my stuff for me . but then I never won and so I guess the universe didn't think this was a smart plan. LOLOL

But because you posted it here you left yourself open to a lot of criticism for not being upfront with the trustee and allowing your chapter 13 to be dismissed. However if your Dad wins the lottery and chooses to pay off some bills for you then that is his decision.

[HHM]

Putting aside the fraud issue for now...

I suppose congrats on the winnings, jut realize that after taxes that will only be $162,000.

Keep in mind, if your dad claims it, he will pay tax on the amount (the lottery people will withhold 28% but if the amount puts your dad into the 35% bracket, more tax will be due at tax time), and when he "gifts" it to you, you will pay tax again on the money you get, not exactly a wise move. How much debt do you have in your chapter 13; could you simply pay off the chapter 13. In any event, you need to crunch the numbers.

First some background questions...

Why were you in a chapter 13 in the first place, what has changed such that you are able to convert to 7 in 2010 (remember, you have to show changed circumstances). Why is your lawyer a scumbag, if you made it this far, doesn't seem like he/she did anything wrong, you got a confirmed chapter 13, etc.

[debtisbad4u]

I must confess, I didnt really win! but wanted to know would happen if I did, my dad plays the lottery a lot and I can't decide if he should claim or I should.

[forgotten]

I must confess, I didnt really win! but wanted to know would happen if I did, my dad plays the lottery a lot and I can't decide if he should claim or I should.

Then you don't need to worry about it... you aren't going to win.

Instead of paying the tax for people that are bad at math (lottery), you should save that money for an emergency fund.

Your odds of winning $200,000 in the powerball: 1 in 5,138,133. (powerball.com)

Your odds of being struck by lighting this year: 1 in 700,000. (noaa.gov)

Your odds of dying in car accident this year: 1 in 6,500. (nsc.org)

Of all the things to worry about durring your 13, winning the lottery is not one of them.

[justbroke]

HHM provided good answers on the scope of your questions, but I want to answer these directly.

Is there any way to get out of my Ch. 13 bankrupcy if I have just won $250,000?

Yes. You could actually file to voluntarily dismiss your case. However, this may not be a good idea based on what your Chapter 13 looks like. In other words, who do you owe, how much debt is there, and whether you could actually negotiate down. As HHM wrote, $250K quickly becomes worth only about 60% of the total due to taxes (federal, state, local).

My dad said he would claim the prize for me and then turn it over to me. (I trust him very much!)

Fraud.

I am converting my ch. 13 to a ch. 7 in June of 2010 I just don't want my scumbag lawyer to think he can get a chunk of this change!

Wanting to convert to a Chpater 7 and hiding the money... fraud.

Yes, I know I should pay my creditors and I will but not through his grimy hands!

If that's what you want to do, then why not just buy out your Chapter 13? I don't know why you even mention your "scumbag" lawyer. Your lawyer would get none of this money, unless you need to file a new motion to modify confirmed plan. Even then, those fees aren't all that much.

Look at the BIG picture.

[sassiebaz]

Wow, I wonder if alot of people post false questions on this forum? Interesting. I wondered how this person's luck could have changed in such a dramatic way. But, yeah, after the facts are taken into consideration, I won't be playing ANY lottery games.