Mar 7, 2024,02:01am EST
The Powerball jackpot surged to $521 million after no tickets matched all six numbers drawn on Wednesday night. However, the eventual winner will receive a substantially reduced amount after settling their tax bill.
KEY FACTS
If a winner emerges in the next draw, they will have the option to receive the $521 million spread over 30 annual installments or a lump sum cash payment of $249.6 million, which is typically the more popular choice. After a mandatory federal tax withholding of 24%, the lump sum payout decreases to $189.7 million.
Depending on the winner’s taxable income for the year, they may face a federal marginal rate as high as 37%, further reducing the winnings to $157.25 million. If the installment option is chosen, the winner’s annual payments of $17.36 million could diminish to $10.93 million if the 37% federal marginal rate is applied. The winner’s state of residence will also impact their winnings, as some states like New York levy a 10.9% tax on lottery winnings, while others like Texas, Florida, and California do not tax them at all.
WHAT TO WATCH FOR
The next drawing for the Powerball jackpot is scheduled for Saturday night.
BIG NUMBER The odds of winning the Powerball jackpot are 1-in-292.2 million, slightly better than the Mega Millions jackpot’s 1-in-302.6 million odds.