Powerball jackpot hits $1 billion — sort of. If you win, here's how much would go to taxes

2 years ago 91

The jackpot for Powerball's Monday nighttime drafting is simply a whopping $1 billion.

Sort of, anyway.

The advertised fig represents the pre-tax magnitude you'd get if you were to receive your windfall arsenic an annuity dispersed implicit 3 decades. Yet astir jackpot winners take the upfront one-time currency outgo — which, for this drawing, is little than fractional the annuitized magnitude and besides is simply a pre-tax figure: $497.3 million.

The annuity enactment is higher than it has been, comparative to the currency option, owed to higher involvement rates that marque it imaginable for the crippled to money larger annuitized prizes, according to the Multi-State Lottery Association, which runs Powerball. The currency option, however, is driven by summons sales.

Almost $120 cardinal would beryllium shaved disconnected the top

So what would you wage successful taxes if you were to bushed the likelihood and onshore the jackpot?

Assuming you were similar astir winners and chose the currency option, a 24% national taxation withholding would trim the $497.3 cardinal by $119.4 million.

Yet much would apt beryllium owed to the IRS astatine taxation time. The apical national income taxation complaint is 37% and this twelvemonth applies to income supra $539,900 for idiosyncratic taxation filers and $647,850 for joined couples. Next year, the apical rate is imposed connected income supra $578,125 (individuals) and $693,750 (married couples).

This means that unless you were capable to trim your taxable income by, say, making charitable donations, different 13% — oregon astir $64.7 cardinal — would beryllium owed to the IRS. That would construe into $184.1 cardinal going to national coffers successful all, leaving you with $313.2 million.

State taxes could besides beryllium due, depending connected wherever the summons was purchased and wherever you live. While immoderate jurisdictions person nary income taxation — oregon bash not taxation lottery winnings — others enforce a apical taxation complaint of much than 10%.

Nevertheless, the victor would extremity up with much wealth than astir radical spot successful a beingness oregon two.

And, of course, you astir apt won't request to interest astir however overmuch the jackpot truly would present — the accidental of a azygous summons matching each six numbers drawn successful Powerball is astir 1 successful 292 million.

Meanwhile, Mega Millions' jackpot is $87 cardinal ($42.8 cardinal cash) for Tuesday night's drawing. The accidental of your summons hitting the jackpot successful that crippled is astir 1 successful 302 million.

Read Entire Article