Amanda Clayton, Michigan Lottery Winner, Using Food Stamps Despite $1 Million Jackpot [UPDATE]

Even with an extra million or two, it seems that some lottery winners are still trying to finding ways to save money -- on the government's dime.

Amanda Clayton of Lincoln Park, Michigan won a lottery jackpot worth $1 million, but a local TV news station recently discovered that despite her winnings, she was still using a state-sponsored welfare card to buy $200 of food every month, The Daily Mail reports. As a local reporter points out, those tax dollars could go a long way for residents in a state particularly hard-hit by the recession, but Clayton doesn't seem to see it that way, even though she recently purchased both a new house and a new car with her prize money.

"I mean, I have no income and I have bills to pay," she told local news WDIV. "I have two houses. I'm still struggling."

UPDATE: Michigan state officials said Thursday that Clayton was cut from food assistance, after her story was widely reported.

Turns out Clayton isn't the only one with a big lottery win dipping into the government's coffers. In May 2011, Leroy Fick, also of Michigan, faced criticism for continuing to buy food on the taxpayers' dime after he won a $2 million jackpot, NBC25 reports. Fick said it's not his fault he can still use government benefits, despite his huge win, instead, the "state has got a problem with its laws."

But that problem may soon be solved. Lawmakers in the state's House of Representatives voted to approve legislation that would include lottery earnings when determining residents' income, and their eligiblity for food benefits, CBS Detroit reports. The state is adopting stricter guidelines in general for determining who is eligible for benefits, cutting food stamps for 30,000 college students last year, and limiting the amount of time residents can receive cash from the state.

Instead of taking state money, some jackpot winners are giving away part of their prize. Last December, three money managers in Greenwich, Connecticut, who won $254 million Powerball, established a charitable trust that has already donated $1 million to five separate charities that support veterans and military members. The group says they plan on making more donations in the future.

This post has been updated to include Michigan state officials' announcement that Clayton was cut from food assistance.

Check out some other crazy lottery win stories:

Comments

[deedeedoors]

10:13 PM on 06/15/2012

The lottery commision should have paid her in food stamp's.

[deedeedoors]

10:06 PM on 06/15/2012

Execute her

[hermmot]

03:55 PM on 03/16/2012

I am not a repub, but talk about handing them something on a silver platter! Oh boy. Get ready for the 'deluge'. Can't say I blame them - if this 'oversight' is not addressed immediately.

[sball73]

08:18 AM on 03/11/2012

Lets talk numbers: If she won a 1million dollar jackpot, she will be taxed on that money. Lottery commission pays about 65% of the lump sum. So If you won 1 million you would only actually get $650,000. Now there are state and federal taxes, but for her example lets just go with Federal Taxes we'll go with 40% rate meaning that she would actaully only see $390,00 of those "1 million". She would have to pay taxes of $260,000.

Now lets ASSUME she had been collecting food stamps since 18 yrs old $200 per month for the last 6 year that means she would have collected $14,400.

That means the still wins $245,000 of her money.(plus the 350,000 from the lottery commissino)

I'm not justifying her actions, the problem here is taxation rates (and double taxatation) and the lack of regulation on disbursements.

Another issue is the lack of Personal Finance knowledge in the nation. We need to educate our individuals to make better choices, if your still struggling after winning that much money, your simply ignorant or stupid (which are different things)

[peekaboohope]

06:08 PM on 11/27/2012

This was VERY well put!!!!! Many folks who win just are NOT that financial suave and once they get that amount they get scared or they get the money high or they get family & friends that start asking for things when their VERY FIRST stop should be to a TRUSTED Financial Adviser who can EXPLAIN everything at their level.

[Harry Scrote]

01:43 PM on 03/10/2012

Well, she'll never get food stamps again. Ours is a nation of hustlers.

[noudidnt]

07:50 AM on 03/10/2012

Jail

[noudidnt]

07:48 AM on 03/10/2012

Whiteentitlement syndrome

[gravedigger101]

06:43 AM on 03/10/2012

they should make her pay back tripple the money.

[cales1960]

11:41 PM on 03/09/2012

Well I am glad to see the update: She no longer receives food stamps. If you need money and cant afford to feed yourself and your family then you shouldn't have bought a 2nd home and a new car............................

[LaShondia]

07:36 PM on 03/14/2012

LOL When I saw she said she has two homes, a car and no income... in my mind (cuz I'm in the library) I went W T F??? I'm trying to figure how to find an affordable place for my teenage son and I that isn't a shoe box and she talks about having TWO homes. Hell, I don't even get food stamps, here in Maryland I make too much

[oniya]

11:14 PM on 03/09/2012

Not only should lottery winners' proceeds be counted when calculating government aid eligibility, but it would also be good to present the winners with an opportunity to reimburse the state for past funds received. It should not be required, but it would be kind of a pay-it-forward opportunity to do something good in the world.

[Ian Gord]

01:04 PM on 03/09/2012

How does this qualify as a "Business" story?

[MIVOTE]

12:51 PM on 03/09/2012

SMH. It's because of people like this lady that the people that really, really need it have to beg for support.

Sell a house, invest your money and donate to charity. The state will be sending you another bill I am sure.

[MDean]

12:07 PM on 03/09/2012

Even the lottery winners know that what they were doing was wrong, if not illegal...
The Michigan legislature is working on changing the laws to require lottery winnings to be reported as income, and they should be implementing an asset requirement as well.

[diverjay]

12:01 PM on 03/09/2012

"I mean, I have no income and I have bills to pay," she told local news WDIV. "I have two houses. I'm still struggling."

After winning a million dollars? Wow. Just wow.

[Smurfaveli]

11:34 AM on 03/09/2012

She lives about 15 mins from me. Maybe she'll invite me over for dinner, paid for with some of my tax dollars?

[john thiret]

06:03 PM on 03/19/2012

So tired of seeing comments from people saying she is spending their tax dollars. She paid $200,000 in taxes on her winnings. She is covered for the next 83 years at $200 a month just from the taxes she paid on the winnings . If the only arguments people have is that she is wasting their tax dollars they really need to get a calculator.In reality she should be thanked. I mean how many people on food stamps paid enough in taxes to cover what they are receiving a month. This women paid enough in taxes to cover herself and others.