- Days left
The Tennessee Legislature is looking to make life a little more difficult for the poor.

A bill is scheduled to be discussed at a committee hearing Wednesday, April 8, that would prohibit anyone receiving state or federal assistance, sometimes called welfare, from winning $600 or more in the state lottery.

However, the author of the bill, Rep. Stacey Campfield, told me in a telephone interview on Wednesday morning that a subcommittee didn't have time to get to it, so the meeting on it has been delayed about two weeks. I'll check back with Campfield then for another update.
The thinking behind the bill is that if someone can't afford the basic necessities and is getting food stamps, for example, from the government, then they shouldn't spend money on something like the lottery. On the other side of the issue, people are saying that the government shouldn't tell them how to spend their money. Here's a video from wate.com, a TV news channel in Tennessee:

The bill doesn't say anything about preventing the unemployed from winning big in the lottery. It just prevents people getting public assistance from winning big -- even if they have jobs.

Studies have shown that poor people spend a larger percentage of their incomes on lottery tickets than wealthier people. Part of the draw is a last-ditch effort to get out of poverty, even though the odds of winning are very slim.

Prohibiting the indigent from winning more than $600 would lead to those people not playing the lottery, which would lead to less money for the state, since the state keeps much of the money spent on the lottery.

A state fiscal review of the Tennessee bill found that lottery sales would drop by approximately 2.37%, or 147,403 fewer players, if the law is passed. Net lottery ticket sales are projected to drop by $23,972,100 in fiscal year 2009-10.

And here's a figure that amazed me: The state's review found that half, or 294,805 individuals, of the people who receive food stamps from the state buy lottery tickets. Half of those people are projected to stop playing the lottery if the bill passes.

If those people stop playing Tennessee will lose $6.4 million in scholarships and grants that it provides each year from its proceeds.

But for the remaining half of food stamp recipients, or 147,403 people, who would continue to play the lottery despite being prevented from keeping their winnings over $600, the money would go to the state. They'd be playing for the state.

The Tennessee Education Lottery Corp. reported to the state that approximately 11% of the awarded prizes are for $600 or more. So if half of the food stamp recipients continue playing, and thus continue donating their winnings to the state, the after-school programs would gain more than $1.3 million a year.

As of February, Tennessee has a 9.1% unemployment rate, leaving 276,312 state residents out of work. It's a population almost equal to the number of people in Tennessee who receive food stamps.

Hopefully a legislator won't try to expand the bill prohibiting large lottery winners to people who receive state unemployment checks. Being unemployed is already difficult enough, but being unemployed and poor would be a lot worse.

Aaron Crowe is an unemployed journalist in the San Francisco Bay Area. Read about his job search at www.AaronCrowe.net


Increase your money and finance knowledge from home

What is Inflation?

Why do prices go up?

View Course »

Intro to Retirement

Get started early planning for your long term future.

View Course »

TurboTax Articles

Video: Who Qualifies for an Affordable Care Act Exemption (Obamacare)?

The Affordable Care Act requires all Americans to have health insurance or pay a tax penalty. But, who qualifies for an Affordable Care Act exemption? Find out more about who qualifies for an exemption from the Affordable Care Act tax penalty, how to claim an exemption on your tax return and how the Affordable Care Act may affect your taxes with this video from TurboTax.

Video: How to Claim the Affordable Care Act Premium Tax Credit (Obamacare)

The Affordable Care Act Premium Tax Credit is a new refundable tax credit that can lower your monthly health insurance premiums. If you qualify for the tax credit, you can claim the Premium Tax Credit throughout the year to lower your monthly health insurance premiums, or claim the credit with your tax return to either lower your overall tax bill or increase your tax refund.

Deducting Summer Camps and Daycare with the Child and Dependent Care Credit

If you paid a daycare center, babysitter, summer camp, or other care provider to care for a qualifying child under age 13 or a disabled dependent of any age, you may qualify for a tax credit of up to up to 35 percent of qualifying expenses of $3,000 for one child or dependent, or up to $6,000 for two or more children or dependents.

What Is Schedule H: Household Employment Taxes

If you hire people to do work around your house on a regular basis, they might be considered household employees. Being an employer comes with some responsibilities for paying and reporting employment taxes, which includes filing a Schedule H with your federal tax return. But even if you have household employees, filing Schedule H is required only if the total wages you pay them is more than certain threshold amounts specified by federal tax law.

Add a Comment

*0 / 3000 Character Maximum