Tex. Gov't Code Section 466.410
Assignment of Prizes


(a)

A person may assign, in whole or in part, the right to receive prize payments that are paid by the commission in installments over time if the assignment is made to a person designated by an order of a district court of Travis County, except that a person may not assign the right to receive prize payments if the person is subject to a child support order and is delinquent in making support payments under that order.

(b)

A district court shall issue an order approving a voluntary assignment and directing the commission to direct prize payments in whole or in part to the assignee if:

(1)

a copy of the petition for the order and copies of all notices of any hearing in the matter have been served on the executive director not later than 20 days prior to any hearing or entry of any order. The commission may intervene in a proceeding to protect the interests of the commission but shall not be considered an indispensable or necessary party. A petition filed under this section shall include in the caption the prize winner’s name as it appears on the lottery claim form;

(2)

the assignment is in writing, executed by the assignor and assignee (or designated agent), and by its terms subject to the laws of this state; and

(3)

the assignor provides a sworn and notarized affidavit stating that the assignor:

(A)

is of sound mind, over 18 years of age, is in full command of the person’s faculties, and is not acting under duress;

(B)

is not delinquent in payment of child support under a court or administrative order issued in this state or another state;

(C)

has been advised regarding the assignment by independent legal counsel and has had the opportunity to receive independent financial and tax advice concerning the effects of the assignment;

(D)

understands that the assignor will not receive the prize payments, or portions of the prize payments, for the assigned years;

(E)

understands and agrees that with regard to the assigned payments, the state, the commission, and its officials and employees will have no further liability or responsibility to make the assigned payments to the assignor;

(F)

has been provided a one-page written disclosure statement stating, in boldfaced type, 14 points or larger:
(i)
the payments being assigned, by amounts and payment dates;
(ii)
the purchase price being paid, if any;
(iii)
if a purchase price is paid, the rate of discount to the present value of the prize, assuming daily compounding and funding on the contract date; and
(iv)
the amount, if any, of any origination or closing fees that will be charged to the assignor; and

(G)

was advised in writing, at the time the assignment was signed, that the assignor had the right to cancel without any further obligation not later than the third business day after the date the assignment was signed.

(c)

It shall be the responsibility of the assignor to bring to the attention of the court, either by sworn testimony or by written declaration submitted under penalty of perjury, the existence or nonexistence of a current spouse. If married, the assignor shall identify his or her spouse and submit to the court a sworn and notarized statement wherein the spouse consents to the assignment. If the assignor is married and the sworn and notarized statement is not presented to the court, the court shall determine, to the extent necessary and as appropriate under applicable law, the ability of the assignor to make the proposed assignment without the spouse’s consent.

(d)

With respect to any given prize, the order shall also recite and identify all prior assignments by amount of or fraction of payment assigned, the identity of the assignee, and the date(s) of payment(s) assigned. A court order obtained pursuant to this section, together with all such prior orders, shall not require the commission to divide any single prize payment among more than three different persons.

(e)

The court order shall include specific findings as to compliance with the requirements of Subsections (b), (c), and (d) and shall specify the prize payment or payments assigned, or any portion thereof, including the dates and amounts of the payments to be assigned, the years in which each payment is to begin and end, the gross amount of the annual payments assigned before taxes, and the name of the prize winner as it appears on the lottery claim form.

(f)

A certified copy of a court order granted under this section shall be delivered to the commission and such order must be provided to the commission no later than 20 days prior to the date upon which the first assigned payment is to be paid to the assignee. Within 20 days of receipt of the court order, the commission shall acknowledge in writing to both the assignor and the assignee its receipt of said court order. Unless the commission provides written notice to the assignor and assignee that the commission cannot comply with the court order, the commission shall thereafter make the prize payments in accordance with the court order.

(g)

The commission shall establish and collect a reasonable fee to defray any administrative expenses associated with an assignment made under this section, including the cost to the commission of any processing fee imposed by a private annuity provider. The commission shall establish the amount of the fee to reflect the direct and indirect costs associated with processing the assignment.

(h)

An assignment pursuant to court order may not include or cover payments or portions of payments that are subject to any offset provided by this chapter.

(i)

Notwithstanding any other provision of this section, there will be no right to assign prize payments following:

(1)

the issuance, by the Internal Revenue Service, of a technical rule letter, revenue ruling, or other public ruling of the Internal Revenue Service that determines that, based on the right of assignment as provided by this section, a lottery prize winner who does not assign prize payments would be subject to an immediate income tax liability for the value of the entire prize rather than annual income tax liability for each installment when paid; or

(2)

the issuance by a court of a published decision holding that, based on the right of assignment as provided by this section, a lottery prize winner who does not assign prize payments would be subject to an immediate income tax liability for the value of the entire prize rather than annual income tax liability for each installment when paid.

(j)

After receiving a letter or ruling from the Internal Revenue Service or a published decision of a court as provided by Subsection (i)(1) or (2), the executive director shall immediately file a copy of the letter, ruling, or published decision with the secretary of state. When the executive director files a copy of the letter, ruling, or published decision with the secretary of state, an assignor is ineligible to assign a prize under this section, and the commission shall not make any payment to an assignee pursuant to a court order entered after the date of such letter or ruling.

(k)

Section 9.406 (Discharge of Account Debtor; Notification of Assignment; Identification and Proof of Assignment; Restrictions on Assignment of Accounts, Chattel Paper, Payment Intangibles, and Promissory Notes Ineffective), Business & Commerce Code, does not apply to periodic payments of lottery prize winnings under this section.
Added by Acts 1999, 76th Leg., ch. 1394, Sec. 4, eff. Sept. 1, 1999.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 403 (S.B. 626), Sec. 5, eff. June 17, 2011.

Source: Section 466.410 — Assignment of Prizes, https://statutes.­capitol.­texas.­gov/Docs/GV/htm/GV.­466.­htm#466.­410 (accessed Mar. 23, 2024).

466.001
Short Title
466.002
Definitions
466.004
Exemption from Taxation
466.012
Division Employees
466.014
Powers and Duties of Commission and Executive Director
466.015
Rules
466.016
Annual Report
466.017
Audits
466.018
Investigations
466.019
Enforcement
466.020
Security
466.021
Demographic Studies
466.022
Confidential Information
466.023
Department of Public Safety Records
466.024
Prohibited Games
466.026
Amber Alert
466.027
Veterans’ Assistance Game
466.028
Comprehensive Business Plan
466.101
Procurement Procedures
466.102
Liquidated Damages
466.103
Prohibited Contracts
466.104
Assistance of Comptroller
466.105
Applicability of Other Law
466.106
Preference for Texas Businesses
466.107
Minority Businesses
466.108
Television Contracts
466.109
Publicity of Individuals Prohibited
466.110
Prohibited Advertisements
466.151
License Required
466.152
License Application
466.153
Change in Application Information
466.154
Rules
466.155
Denial of Application or Suspension or Revocation of License
466.156
Bond
466.157
Display of License
466.158
Expiration of License
466.159
Death, Dissolution, or Bankruptcy of Sales Agent
466.160
Summary Suspension of License
466.0161
Review by Comptroller
466.161
Immunity
466.201
Access to Criminal History Record Information
466.202
Fingerprints
466.203
Department of Public Safety Assistance
466.204
Access to Internal Revenue Service Information
466.205
Confidential Information
466.251
Tickets
466.252
Purchase of Ticket Agreement to Abide by Rules
466.254
Purchase of Ticket by or Payment of Prize to Certain Persons
466.256
Representatives by Person Claiming Lottery Prize
466.302
Sale of Ticket at Price Greater than Fixed Price
466.303
Sale of Ticket by Unauthorized Person
466.304
Sale of Ticket at Unauthorized Location
466.305
Sale of Ticket on Credit
466.306
Forgery
466.307
Influencing Selection of Winner
466.308
Claiming Lottery Prize by Fraud
466.309
Tampering with Lottery Equipment
466.310
Certain Transfers of Claims
466.311
Reporting and Record Violations
466.312
False, Incorrect, or Deceptive Statement
466.313
Conspiracy
466.317
Prohibition Against Sale of Certain Lottery Tickets
466.351
Delivery of Funds
466.352
Reporting by Sales Agent
466.353
Liability of Sales Agent
466.354
Duties of Comptroller
466.355
State Lottery Account
466.357
Applicability of Constitutional Provisions
466.358
Compensation of Sales Agent
466.359
Compensation of Sales Agent for Purposes of Contractual Rental Payment
466.401
Ticket Validation
466.402
Payment of Prizes Generally
466.403
Payment of Prize in Installments
466.404
Payment of Prize to Multiple Winners
466.405
Payment of Prize Awarded to Minor
466.406
Right to Prize Not Generally Assignable
466.407
Deductions from Prizes
466.408
Unclaimed Prizes
466.409
Treatment of Prize Payable on Ticket Purchased by Ineligible Person
466.410
Assignment of Prizes
466.411
Choice by Certain Prize Winners to Remain Anonymous
466.451
Multijurisdiction Agreement Authorized
466.452
Revenue from Multijurisdiction Lottery
466.453
Payment of Costs Authorized
466.1005
Procurements
466.3011
Venue
466.3012
Aggregation of Amounts Involved
466.3052
Purchase and Sale of Tickets
466.3053
Purchase of Ticket with Proceeds of Afdc Check or Food Stamps
466.3054
Group Purchase Arrangements
466.4001
Definition
466.4075
Deductions of Child Support from Certain Lottery Winnings

Accessed:
Mar. 23, 2024

§ 466.410’s source at texas​.gov