RESOLVING THE LEDGER
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The Powerball jackpot for Wednesday night’s drawing has ballooned to $1 billion after no winning tickets were sold for Monday’s $905 million grand prize.
Monday’s winning numbers were 6, 37, 54, 55, 64 with a Powerball of 10.
While no one hit the jackpot on Monday, if you live in California, Maryland or Tennessee, check your tickets. That’s because a ticket in each of those states matched all five white balls to win at least $1 million. In Tennessee, the ticket included the Power Play option for an additional $1 million, which increased the winnings to $2 million.
The $1 billion jackpot for the next drawing is for a single-winning ticket who chooses an annuity option, paid over 30 years. Winners almost always opt for cash prizes, which would be $433.1 million — before taxes.
The Powerball jackpot has been growing for more than three months, reflecting the long odds of 1 in 292.2 million of winning the top prize. Since the last player won the jackpot on May 2, there have been 44 consecutive drawings without anyone matching all six numbers and hitting it rich.
Powerball is played in 45 states plus Washington, D.C., Puerto Rico and the U.S. Virgin Islands. Drawings are held at 10:59 p.m. ET at the Florida Lottery studio in Tallahassee.
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Federal taxes on lottery winnings
The prize is subject to an automatic federal withholding, with the IRS levying 24% on winnings of more than $5,000.
If you choose the $433.1 million cash option, the 24% withholding automatically reduces your prize to about $329.2 million, with nearly $104 million going straight to Uncle Sam.
And when you file your 2026 returns, plan on paying another 13% in federal taxes. That’s because the millions you win from the lottery pushes you into the top tax bracket of 37%.
State taxes on lottery winnings
There are also state taxes in most jurisdictions, which range from a low 2.9% in North Dakota to 10.9% in New York.
But if you’re lucky enough to live in California, Florida, New Hampshire, South Dakota, Tennessee, Texas, Washington or Wyoming, you won’t pay any state taxes on your winnings.
And if you live in one of the five states that don’t have a lottery (Alabama, Alaska, Hawaii, Nevada and Utah) or purchased your winning ticket in a state you don’t live in, the state where you purchased your ticket may withhold state taxes on your winnings, and you’ll also need to figure out how much you owe to your state at tax time. However, you can usually claim a tax credit for the taxes paid to the other state.
Be careful with pool winnings
If you join a lottery pool with friends or co-workers, TurboTax cautions the person claiming the prize on behalf of the group to document that the entire windfall isn’t theirs or you’ll be responsible for income tax withholding on the entire winnings. Also, if you collect the total winnings and then allot everyone else their share, the IRS may assume that you’re giving the money away, which can result in getting hit with a gift tax.
The tax applies to gifts you give over $15 million for 2026. And it’s taxed at a rate of 40%, according to the IRS .
Have everyone enter into the pool with a written contract defining his or her shares, which you can then provide to the IRS if necessary, according to TurboTax .
If you win the jackpot, experts suggest working with a tax professional, financial advisor and estate planning attorney immediately.
“It’s all about protection and paying the least amount of taxes possible, so working with professionals is very important,” said certified financial planner John Chichester Jr., founder and CEO of Chichester Financial Group in Phoenix.
He said winners who choose the 30-year annuity payments option may have “a lot more flexibility” for tax planning.
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