Map: How much of the $607M Mega Millions jackpot would a winner lose to taxes? (2024)

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Map: How much of the $607M Mega Millions jackpot would a winner lose to taxes? ›

At best, according to an analysis by USA Mega, a Mega Millions jackpot winner will get about $383.7 million with the annuitized payout (30 annual payments that gradually increase) or $180.8 million — that's $223.3 million or $106.1 million you'd lose to taxes, respectively.

Most states charge taxes on winnings, too, which range from 2.5% to 10.9%. Eight states don't charge any income tax on lottery winnings: California, Florida, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming.

The cash prize amount will drop to around $223 million after a mandatory federal tax withholding of 24% is deducted. Depending on the winner's final taxable income, they may face up to a 37% federal marginal rate—further cutting down their fortune to $184.8 million.

Before seeing a penny of the jackpot, the winner will pay a 24% mandatory upfront federal withholding to the IRS. If they choose the $536.6 million cash option, the 24% withholding automatically reduces the prize by about $129 million.

The lump sum prize drops to $271.5 million after a mandatory federal tax withholding of 24% is applied. Depending on their taxable income, the winner could then face a federal marginal rate as high as 37%, cutting their winnings further to $225.1 million.

Lottery winnings, considered taxable income, are subject to both federal and state income taxes. The Internal Revenue Service (IRS) imposes a federal tax rate of 24%, and California's state income tax, with rates ranging from 1% to 13.3%, adds an additional layer of taxation.

How much do I pay in taxes if I win 1,000,000? If your gross prize for lump sum payout is $1,000,000, you need to pay $334,072 in total tax ($240,000 federal withholding, plus the remaining $94,072 for single filing status in 2021).

Do lottery winnings count as earned income for Social Security purposes? Lottery winnings are not considered earned income, no matter how much work it was purchasing your tickets. Therefore, they do not affect your Social Security benefits.

“I honestly think most people are probably better off taking the annuity.” As mentioned, the annuity option means you'll receive a check every year with another, slightly larger portion of your lottery winnings. While that annual allowance may sound annoying to a newfound jackpot winner, it can also help protect you.

The cash payout drops to $248.7 million after a mandatory federal tax withholding of 24% is applied. The winner may then face a 37% federal marginal rate—depending on their taxable income—dropping their winnings further to $206.2 million.

How much would you get if you won $100 million dollars? ›

So, you may ask, "How much do I get if I win the Powerball?" It is about 52 percent of the total jackpot amount (before taxes). For example, if the Powerball jackpot is at $100 million, the cash value would be around $52 million.

The estimated value of annuity payments over 30 years is $1.35 billion, which averages $45 million per year. The Mega Millions annuity comprises one immediate payment and 29 annual payments, and the payouts are made on an annual basis.

What if you win the jackpot? Annuity option: The Mega Millions annuity is paid out as one immediate payment followed by 29 annual payments. Each payment is 5% bigger than the previous one. This helps protect winners' lifestyle and purchasing power in periods of inflation.

Your first annuity payment, or the single cash option payment, should arrive within six to eight weeks. There are generally no California state taxes for Lottery prizes, but we are required to withhold federal taxes.

It is true that lottery annuities are generally guaranteed, backed by the state or insurance companies that issue them. They offer a steady income over a period, typically 20-30 years, reducing the risk of spending all winnings at once. However, consider inflation and your financial goals before choosing an annuity.

Senior Contributor. I focus on taxes and litigation. The winning Powerball ticket was sold at Joe's Service Center in Altadena, California, entitling the ticket holder to a massive $2.04 billion jackpot.

Mega Millions cash value calculator. How much will I get? Choosing to get paid at once today will get you only about 80% of your total jackpot winnings, and after you pay taxes on your winnings, you'll probably end up with around 50%.

A 24% federal tax withholding is taken right away, dropping the lump sum estimate to about $363.4 million. Because the federal government counts lottery winnings as income, the winner could be moved into a tax bracket facing a tax rate as high as 37%, which could drop the lump sum to around $301.3 million.

When it comes to lottery prizes, the first thing that happens after you turn in that winning ticket and get your lump sum is that the federal government takes 24% of the winnings off the top. But the payments don't end there. You will owe the rest of the tax — the difference between 24% and 37% — at tax time next year.