Lottery Winnings and State Owned Debt

Do you owe money on a student loan? Back child support? Back taxes and other debts? Then the North Carolina Lottery is definitely not for you! North Carolina sold its first lottery ticket in March 2006 and since then the state has collected $1.3 million in back child support, delinquent student loans, back taxes, and other debts including medical bills owed to state and local hospitals. Under North Carolina state law the lottery is required to check to make sure winners do not owe the government any money.

204 state lottery winners have paid over $274,000 in back child support since the North Carolina lottery was started. North Carolina lottery officials say that student debt and unpaid medical bills are common among lottery winners. Alice Garland, a spokeswoman for the North Carolina state lottery says that most lottery winners indicate that they are willing to pay their debts voluntarily. When asked what they will use lottery winnings for, most winners say that paying off their mortgage is their top priority.

For some lottery winners only a few hundred dollars are taken for debts while others have seen their entire jackpot confiscated by the state. Ms. Garland said that some winners who had their lottery winnings garnisheed were actually relieved to have past debts settled. One winner who won $100,000 on a scratch off ticket was happy his children were going to get the back child support he owed.

Of course many lottery winners are less than pleased to have their winnings seized. One $35,000 winner who walked out of the lottery office with nothing wondered aloud which former wife would get the money. Many state lotteries routinely check for state owned debt which includes back taxes and child support so it is wise for lottery winners to check the policies of the lottery in the state where they will collect their lottery winnings.

Several states are considering the possibility of offering online lottery tickets. Players could log on to a state website and make an online lottery purchase. Computer technology could also allow the state to check winners against a database of those who owe fines, back child support and other debts. Lottery players could also check for the latest lottery results and winners could be notified by email. Most players say they would appreciate the convenience that the ability to buy online lottery tickets would bring. Online lottery tickets would eliminate the need for a trip to a lottery retailer and most players would welcome the move online.