RESOLVING THE LEDGER
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Topline The Powerball jackpot rose to $707 million—the second biggest lottery prize of the year so far—after no tickets matched all six numbers drawn on Wednesday night, although the eventual winner will take home a much smaller payout after taxes and deductions.
The six numbers drawn on Wednesday night were 30, 36, 40, 42, 57 and Red Powerball 2.
If a winner emerges in the next draw, they can choose between taking the $707 million split across 30 annual installments or a one-time cash prize of $309.7 million—the preferred pick for most winners.
If the cash prize is chosen, the winnings will first drop to $235.4 million after a mandatory 24% federal withholding is applied.
The winner would likely face a federal marginal rate as high as 37%, depending on their taxable income, further reducing the winnings to around $195.1 million.
If the installment option is chosen, the winner’s annual payouts of $23.5 million will drop to around $14.8 million after the 37% federal marginal rate is applied.
Depending on where they live, the winner could face additional taxes, as some states, such as New York, tax lottery winnings at 10.9%, while others, such as Texas, Florida, and California, don’t.
Starting last week, the Powerball Jackpot expanded to include U.K. lottery players, which officials claim will lead to “faster-growing jackpots,” with additional ticket sales contributing to the prize fund. If the Powerball winner is a U.K. player, they will not have the option to pick the lump-sum payout and can only receive the jackpot split across 30 annual payments. The advertised jackpot prize for U.K. players is £377 million ($503.5 million). While this appears significantly lower than the $663 million U.S. prize, the U.K. National Lottery says it reflects the estimated amount a winner would receive over a 30-year period, “after exchange rates and UK tax requirements have been taken into account.”
This is on track to be the second biggest lottery prize of the year so far. The biggest prize was claimed on Tuesday night after a Florida ticket buyer emerged as the winner of an $800 million Mega Millions jackpot prize. The biggest completed Powerball jackpot of the year so far is a $250.8 million prize won by a lottery player from Arkansas.
The next Powerball drawing is set to take place on Saturday night.
1-in-292.2 million. Those are the astronomical odds a Powerball ticket buyer will need to overcome to win the jackpot prize. This is even worse than the Mega Millions jackpot’s already poor odds of 1-in-290.4 million.
Mega Millions Ticket Buyer From Florida Wins $800 Million—Here’s What They Could Take Home (Forbes)
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