Here’s How Much in Taxes You’ll Pay If You Win the $1.35 Billion Mega Millions Jackpot (and Other Fun Facts)
The Mega Millions Powerball jackpot lived to fight another day, as nobody won the jackpot during Wednesday night’s drawing. The next drawing — scheduled for Friday, Jan. 13 — will push the grand prize to $1.35 billion.
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The most recent drawing was the 25th time in a row that nobody won the big prize, KARE-11 reported, though quite a few players won $1 million or more. The jackpot has been rolling since Oct. 14, 2022.
The odds are not exactly great that you’ll hit the winning number. You have about a 1 in 302.6 million chance, CNBC reported. If somebody does hit the jackpot, chances are they will choose the lump sum option. For the current jackpot, the lump sum is $707.9 million.
Just don’t expect to take nearly that much money home. After Uncle Sam gets his cut, the dollar amount will shrink considerably. As CNBC noted, the amount would be reduced by a mandatory 24% federal tax withholding, which would lower the winning total to $538 million.
The cut probably won’t stop there, however. The top marginal income tax rate of 37% applies to annual income above $578,125 for individual tax filers and $693,750 for married couples — and a $707.9 million lump-sum payment would push filers above those thresholds. In this case, the net amount would fall to $446 million — and that’s before state income taxes are withheld.
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If the winner is lucky enough to live in a state with no state income tax, this won’t be a problem. Eight states have no state income tax, according to Intuit TurboTax: Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming.
Angela Corry contributed to the reporting for this article.
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This article originally appeared on GOBankingRates.com: Here’s How Much in Taxes You’ll Pay If You Win the $1.35 Billion Mega Millions Jackpot (and Other Fun Facts)
