The Powerball drawing Wednesday is worth $700 million, the second-largest windfall in the program’s history. Depending on the state where the winning ticket is sold, the chosen one(s) will receive far less than the total advertised.
According to Time, a single winner will receive the $700 million check only if they choose an annuity, which is paid out over 29 years. Selecting the lump sum option, which most winners do, will gross $443 million.
Time says federal government will then take a 25% cut of the winnings (foreigners are taxed 30%), leaving the winner with a $308.8 million jackpot, or $17.5 million per year, if they pick the annuity, according to USA Mega, a site that tracks the numbers. (Whether to take the lump sum or the annuity is a heated debate, but far more winners have selected the one-time payment.)
Then there’s state taxes to take into consideration. Some states, like Texas and California, do not tax lottery winnings, while others tax as much as 8.82%. Puerto Rico would take the most out of a lump sum at $443.3 million, while New York residents would take the least at 293.3 million. Here’s how some states in our region would take, per USA Mega. For a full list, check out Time’s article.
District of Columbia: 8.5% state tax
- Annuity: $465,500,010
- Lump Sum: $294,794,500
Kentucky: 6% state tax
- Annuity: $483,000,000
- Lump Sum: $305,877,000
Ohio: 4% state tax
- Annuity: $497,000,010
- Lump Sum: $314,743,000
West Virginia: 6.5% state tax
- Annuity: $479,499,990
- Lump Sum: $303,660,500
