The Best and Worst States for Powerball Winners
The estimated Powerball jackpot for today's drawing is $1.5 billion, if the winner agrees to receive it in yearly installments over 30 years. If you want your winnings in a lump sum, the payout is reduced to $930 million. But you won't get even that much. The IRS takes a hefty cut off the top of lottery winnings–and most states demand a chunk of their own.
Where this jackpot is worth the most
Most states tax lottery winnings like regular income; others don’t touch lottery windfalls.
That giant jackpot shrinks by about two-thirds
The IRS takes 25 percent off the top. The winner will then have to pay the federal government an additional 14.6 percent at tax time, for a total of 39.6 percent–the maximum individual tax rate. That means the most a winner can hope to take home is $561.7 million. Still not too shabby!
Where you'll owe the most in taxes
State income taxes for the highest bracket vary from 0 to 9.9%–excluding California and Pennsylvania, which exempt lotto winnings. Here's what states collect in the tax year, and the final payout a resident of that state could expect. Moving to another state to avoid taxes won't necessarily help.