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Thank you for your question.That very much depends. Was the debt discharged? Are you filing for Chapter 7 (full liquidation) or Chapter 13 (restructuring)? If the former, upon discharge of debt the debt holder can no longer pursue you for the payoff since the debt is no longer something that you are legally responsible for. In a Chapter 13 situation, a trustee is in charge of your assets and he or she has the ability to settle or set payment schedules with creditors. In that situation, since the debt is not discharged, merely reconsolidated, your winnings would go toward payoff of the debt. But again, for the first example, bankruptcy must not simply be filed, it must also be discharged and completed since that removes the debt--if you are simply in the middle of filing, this is still valid debt and something that would require you to pay off the creditors since your winnings would be considered an asset and be taken into consideration by the courts.Good luck.
Thank you for your follow-up.Maryland Chapter 7 bankruptcies are governed under Md. Code Ann, Md Cts. & Jud. Proc. Code Ann. Sec. 11-504, which sets out all of the exemptions which a debtor may keep when they file for bankruptcy (or as the statute calls it, 'executing a judgment'). By definition anything over that amount has to be provided to the trustee so as to go toward paying of the debt. You can find the full statute at the link below:http://www.legalconsumer.com/bankruptcy/bankruptcy-citation.php?CitationID=1063 If funds are provided to someone going through bankruptcy, there may be a potential gift tax liability, as well as the winnings are going to be taxable themselves as income to the party who receives the funds. Good luck.
Diana,The amount is based on the winnings. If you win $200,000,000.00, you do not pay tax on $1.00, it is based on the amount you won.Good luck.
Diana,It is not 'illegal' for you to transfer the ticket, but you would still be the one liable for the taxes and the earnings. Plus the creditors could pursue the ticket, try to stop the transfer, and pursue the winnings directly because yes, this would be fraud. As for being unethical, that is not a legal answer--some things can be ethical but illegal or unethical but perfectly legal. That is more philosophy then a legal answer, and something that practically do not help. In terms of 'linking' the ticket to you, they can always view the tape of who actually purchased the ticket.Good luck.
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