Ticket Sold In LA Wins $1.08 Billion Powerball Jackpot—Here’s How Much The Winner Will Take Home After Taxes
www.forbes.com
Updated Jul 20, 2023, 03:02am EDT
A woman holds Powerball lottery tickets inside a [+][-]store in Homestead, Florida.AFP via Getty Images
The winning ticket holder will have the option to choose between receiving the total $1.08 billion jackpot spread across thirty annual payments or a lump sum payment of $558.1 million—usually the more popular option.
If the winner chooses the lump sum it will face a mandatory federal tax withholding of 24%, leaving them with $424.15 million.
Depending on the winner’s taxable income, the amount could drop as low as $351.6 million if the 37% federal marginal rate is applied.
Under the installment route, the annual payments will be around $36 million, which could drop to $22.68 million once the 37% federal marginal rate is accounted for.
California is one of 14 states in the country that does not tax lottery winnings, although the winner may still be required to pay state and local income taxes.
Mega Millions Jackpot Hits $720 Million—Here’s How Much The Winner Would Take Home After Taxes (Forbes)
www.forbes.com
Updated Jul 20, 2023, 03:02am EDT
Topline
A single ticket sold in Los Angeles won the $1.08 Billion Powerball jackpot on Wednesday—the sixth-largest lottery reward in U.S. history—although the final amount the winner will get to take home will be far smaller after taxes and other deductions are taken into account.
Key Facts
California Lottery announced on Twitter that the winning ticket was sold at “Las Palmitas Mini Market in Los Angeles” and it was the only ticket in the country that matched all six numbers drawn on Wednesday night.The winning ticket holder will have the option to choose between receiving the total $1.08 billion jackpot spread across thirty annual payments or a lump sum payment of $558.1 million—usually the more popular option.
If the winner chooses the lump sum it will face a mandatory federal tax withholding of 24%, leaving them with $424.15 million.
Depending on the winner’s taxable income, the amount could drop as low as $351.6 million if the 37% federal marginal rate is applied.
Under the installment route, the annual payments will be around $36 million, which could drop to $22.68 million once the 37% federal marginal rate is accounted for.
California is one of 14 states in the country that does not tax lottery winnings, although the winner may still be required to pay state and local income taxes.
What To Watch For
The Mega Millions jackpot rose to $720 million after no winner emerged following Tuesday night’s draw. The next drawing is scheduled for Friday. This is the first time in two and half years that both the Mega Millions and Powerball have passed the $500 million jackpot threshold together.Big Number
1-in-292.2 million. That is the astronomical odds the winner had to beat to win the jackpot. The Mega Millions lottery has even worse odds of 1-in-302.6 million.Further Reading
Both Powerball And Mega Millions Jackpots Top $500 Million—Here’s Why There Are So Many Giant Jackpots (Forbes)Mega Millions Jackpot Hits $720 Million—Here’s How Much The Winner Would Take Home After Taxes (Forbes)
