Dec 25, 2024
The Mega Millions jackpot has soared to an estimated $1.15 billion after no ticket matched all winning numbers in the Christmas Eve drawing. This massive jackpot is now the fifth-largest in Mega Millions history, though the eventual winner—facing daunting one-in-302-million odds—will take home significantly less than the advertised amount after mandatory taxes and deductions.
Key Details:
- Payout Options: The lucky winner can choose between 30 annual installments or a lump sum payment of $516.1 million.
- Tax Reductions:
- The lump sum option would be immediately reduced to $392.2 million after a mandatory 24% federal tax withholding.
- Depending on the winner’s total taxable income and deductions, the federal marginal tax rate of up to 37% could further cut the prize to about $325.1 million.
- Annual installment payments would average $24.1 million each, subject to the same federal tax rates.
- State Taxes:
- States like New York, with a 10.9% tax on lottery winnings, would claim a significant portion, while other states like California and Texas do not tax lottery prizes.
What’s Next:
The next Mega Millions drawing is scheduled for Friday at 11 p.m. EST, offering another chance at the life-changing jackpot. Meanwhile, the Powerball jackpot stands at $117 million, with the next drawing on Wednesday night. A Powerball winner opting for the $53.4 million lump sum would see it reduced to $40.5 million after the initial 24% withholding, and further to $33.6 million at the top marginal tax rate.
Surprising Facts:
- This $1.15 billion jackpot is among Mega Millions’ largest prizes ever, with two of the top three jackpots claimed just last year. The all-time record stands at $1.6 billion.
- Mega Millions has only been won on Christmas Eve once before, in 2002, when a $68 million prize went unclaimed.
Background on Rule Changes:
Mega Millions implemented new rules in October aimed at creating “bigger jackpots and better odds” for players. Adjustments included:
- Removing one “megaball” from the draw, slightly improving odds of matching it from 1-in-25 to 1-in-24.
- Eliminating break-even prizes, guaranteeing a minimum win of $10 for matching the “megaball.”
- Introducing a larger starting jackpot and a randomized multiplier for non-jackpot prizes.
As the excitement builds for Friday’s drawing, players across the country are dreaming of becoming the next Mega Millions billionaire—if luck and numbers align.