First, we don’t anticipate that Jeopardy James is now, or will ever be filing for divorce. But when we see someone win THAT BIG, clients as well as potential clients, often ask us who would reap the benefit of this money, should a divorce be filed in the future. So, the question to be answered is, “who gets the money?”
Well, of course, standing in the front of the line is the Internal Revenue Service. Most likely taking their percentage even before Jeopardy writes the check to the winner. And the percentage will be based on the tax rate the winner finds himself/herself in. So, for federal tax purposes, we will assume that the winner will be paying 37% (2019 winnings), so the 2.4 million will be reduced by approximately $888,000, and further reduced by state taxes. But for purposes of this blog, let’s round down to $2,000.000.
Now, who did the work to raise this money? Well certainly the winner did! We all watched James Holzhauer (now known as Jeopardy James), and his predecessor Ken Jennings as they used their amazing brain power to win day after day, week after week. And if we didn’t watch it, we all certainly heard about it!
But is doing the work, alone, without the help of the wives enough to allow either one of them to keep this money as separate property, in the unfortunate event of a divorce?
The simple answer is NO. In Ohio, because the work they put into the show and the brain power that they exhibited was done DURING THE MARRIAGE, the income that they brought in through these efforts is now MARITAL PROPERTY, and subject to an equitable division with their spouse, and equitable would start at ONE MILLION to the spouse, with concepts of equity considering that amount to be a bit higher or lower, depending on successful attorney arguments.
Happy news for a spouse who may have thought this type of a win would preclude them from sharing in the financial windfall…not good news for the winner!!
The same concept exists if James or Ken had purchased the Power Ball Lottery ticket! If purchased DURING THE MARRIAGE, the winnings are MARITAL and subject to an equitable division if the parties filed for divorce.
The attorneys at Joseph & Joseph, Co. LPA hope that you are all winners, and certainly hope that such a win does not result in a termination of the marriage. But the trained attorneys are ready to assist you and counsel you through any difficult situations.
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